Deregulation Revisited: A Tribute to Fred Kahn

To say that Fred Kahn is the archetype and inspiration for the deregulatory policies that have transformed a series of network industries over the last thirty years is no exaggeration. His academic leadership and vision, captured in The Economics of Regulation, attracted needed attention and insights to a field long viewed as a staid exercise in natural monopoly regulation. At the New York Public Service Commission, Fred established a standard for leadership and thoughtful policymakers that elevated the role of such commissions across the country and began to change conventional thinking about telecommunications and electricity regulation. Finally, at the Civil Aeronautics Board, Fred Kahn took the helm of an agency on autopilot and re-evaluated the wisdom of command-and-control regulations that are widely viewed as preventing entry and protecting incumbents. In so doing, he not only helped to transform the regulation of airlines in this country, but made clear that enlightened leadership can make an enormous difference in public policymaking.

Thirty years after the singular accomplishment of spurring the enactment of the Airline Deregulation Act of 1978, it is an opportune occasion to reflect both on the deregulatory initiatives of the last thirty years and, in particular, on Fred Kahn’s teachings and contributions to that effort. An increasing number of commentators who previously advocated deregulation “no longer believe that deregulation has been a complete, an unqualified, success,” as Judge Richard Posner recently put it. This judgment begs the questions: what lessons can we learn from the deregulatory initiative in airlines, what to make of deregulatory efforts in telecommunications and energy, and whether the U.S. economy has indeed outpaced its foreign rivals in part because of its more nimble and less regulated market environment. In this conference, we will bring together a group of policymakers, former policymakers, academics, and industry leaders from across the last several decades to evaluate the legacy of deregulation, with particular attention to and appreciation for Fred Kahn’s leadership and teachings in the area.