THE AIRLINE INDUSTRY AND TOURISM

The tourism industry in many countries of the world has been profoundly shaped by the development of air services. There have been both positive and negative influences. On the positive side, the advances in aircraft technology, improvements in communications and information technology, and more sophisticated management and marketing techniques have improved the quality of air travel and reduced the price of air tickets so that the volume of traffic, particularly on longer routes, has doubled in each of the past three decades (Organization for Economic Cooperation and Development 1997). On the negative side, international air transport has historically been a highly regulated industry with controls on routes, capacity and tariffs. Despite recent moves to liberalization, air transport is still subject to regulatory constraints in many parts of the world and certain aspects of international regulation, particularly those designed to protect state-owned airlines, continue to have adverse impacts on the development of tourism (World Travel and Tourism Council 1997a). The relationship between the airline industry and tourism is therefore a highly complex subject involving an intriguing mixture of technological factors, market pressures and regulatory policies which this chapter attempts to unravel. But before examining these issues it is necessary to take a look at the broad framework of the total travel and tourism industry within which these developments have taken place.