Question: Deregulation of airlines. Since 1978, when the U.S. airline industry was deregulated, researchers have questioned whether the deregulation has ensured a truly competitive environment. If so, the profitability of any major airline would be related only to overall industry conditions (e.g., disposable income and market share) but not to any unchanging feature of that airline. This profitability hypothesis was tested in Transportation Journal (Winter 1990) using multiple regression. Data for n = 234 carrier-years were used to fit the model

Model 1: E(y) = Bot BiXi+ B2X2+ BX+.+ $30*30 VARIABLE B ESTIMATE *-VALUE p-VALUE Intercept 1.2642 .09 .9266 X1 -.0022 -.99 .8392 X2 4.8405 3.57 .0003 X3 - X30 (not given) R2 = .3402 F(Model) = 3.49, p-value = .0001 F (Carrier dummies) = 3.59, p-value = .0001 Source: Leigh, L. E. "Contestability in deregulated air- line markets: Some empirical tests," Transportation Journal, Winter 1990, p. 55 (Table 4)