In the 1970s the general aviation industry sold 15,000 or more airplanes a year but that number dropped by about 10 in the early 1980s. What’s going on? One factor was the dramatic increase in liability as discussed in my paper with Eric Helland, Product Liability and Moral Risk: Evidence from General Aviation. Another factor was the ever-increasing FAA regulation.
But Max Tabarrok raises an interesting puzzle. It is not at all apparent that regulation of personal aircraft has been more stringent than that of automobiles. So why the big difference in results? However, there is one small but very important difference between the control of cars and airplanes.
The most expensive part of the FAA rule is not any specific standard set for pilot training, credit, or flight safety, but rather the gradual change in the program period across these rules. The Department of Transportation (DOT) sets strict safety requirements for vehicles, but manufacturers are allowed to release new designs without DOT certifying that all requirements are met. The law is enforced post office exand the government will impose recall and fines when producers fail to follow the law.
The FAA, in contrast, enforces all of its own safety regulations ex ante. Before the aircraft manufacturers could anything else for the design, they must get FAA sign-off, which could take more than a decade. This regulatory approach also makes the FAA more vulnerable, as any problems with the aircraft after release are blamed on the FAA’s failure to control them. With post office ex Through the implementation of the law, companies that failed to follow the law would be blamed, and the FAA rewarded, by enforcing a recall.
This subtle difference in regulatory framework is a major reason for the stagnation of aircraft design and production.
In a way, this is a message of hope, as it illuminates an attractive political consensus: keep all aviation safety standards as they are, but apply these standards as if they were enforced on cars—that is, with aftermarket surveillance. , remember, and punishment. This small change could revitalize the airline industry as a whole, returning it to the upward trend of information that was lost 50 years ago.
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