<P> A 1996 Government Accountability Office report found that the average fare per passenger mile was about nine percent lower in 1994 than in 1979 . Between 1976 and 1990 the paid fare had declined approximately thirty percent in inflation - adjusted terms . Passenger loads have risen, partly because airlines can now transfer larger aircraft to longer, busier routes and replace them with smaller ones on shorter, lower - traffic routes. Template: Https://www.gao.gov/archive/1996/rc96079.pdf </P> <P> However, these trends have not been distributed evenly throughout the national air transportation network . Costs have fallen more dramatically on higher - traffic, longer - distance routes than on shorter ones . </P> <P> Exposure to competition led to heavy losses and conflicts with labor unions for a number of carriers . Between 1978 and mid-2001, eight major carriers (including Eastern, Midway, Braniff, Pan Am, Continental, Northwest Airlines, and TWA) and more than 100 smaller airlines went bankrupt or were liquidated--including most of the dozens of new airlines founded in deregulation's aftermath . </P> <P> For the most part, smaller markets did not suffer the erosion of service predicted by some opponents of deregulation . However, until the advent of low - cost carriers, point - to - point air transport declined in favor of a more pronounced hub - and - spoke system . A traveler starting from a non-hub airport (a spoke) would fly into the hub, then reach the final destination by flying from the hub to another airport, the spoke . While more efficient for serving smaller markets, this system has enabled some airlines to drive out competition from their "fortress hubs ." The growth of low - cost carriers such as Southwest Airlines has brought more point - to - point service back into the United States air transport system, and contributed to the development of a wider range of aircraft types that are better adaptable to markets of varying sizes . </P>

Prior to the passage of the airline deregulation act of 1978 airlines compete on price