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As Oil Prices Fall, Air Fares Still Stay High
Just over two years ago, one of the nation’s airline trade organizations called the industry “hypercompetitive” and declared “airfare remains a bargain.” At the time, the Justice Department was weighing the competitive implications of a merger between American Airlines and US Airways, just a year after the merger of United and Continental. Fast-forward to the present. Far from “hypercompetitive,” the airline industry is increasingly looking like an uncompetitive oligopoly. For proof, look no further than airline ticket prices. Over the last year, oil prices have dropped by more than 50 percent. ... (full story)