Banning In-Flight Phone Calls: Choosing Government over Market Institutions
The U.S. Department of Transportation is pushing for an in-flight ban on mobile phone calls, saying they are disruptive and unpopular with passengers and flight crews, according to this Wall Street Journal story.
The airlines are pushing to keep control. They would presumably experiment with different rules and situations, converging on the best solution for them and their passengers.
It’s interesting to bear in mind what the valuable good in question is. It’s the audio frequency (i.e., sound that’s audible to most people) within close proximity of other people while aboard a commercial flight. Some people in certain situations value that good for the purpose of making a phone call. With different people or situations, someone might value the good for keeping silence to sleep, read, work and so forth.
An efficient outcome would let the property rights to the good settle with the party that values it the most. In principle, any two people sitting next to each other can negotiate the price of making a phone call. In reality, however, there might be high transaction costs. Like it’s sort of culturally strange to be striking up bargains on board. This is where social norms play a role. There’s no federal rule that says “keep your elbow either toward the front or rear of the armrest, and it’s okay if the adjacent passenger wants to insert their elbow on the portion of the armrest where yours isn’t,” but that’s the way people do it.
So the choice is not between government regulation and no regulation. That false dichotomy forgets the discipline of market competition and social norms, especially their regulating forces on behavior in public. The choice instead is whether to allocate the valuable good through government or through market institutions. Should government agents in centralized bureaucracies decide what is the best use of sound and require airlines to comply? Or should competitive trial-and-error guide the rules toward the preferences that people reveal through experience?
Clearly the U.S. DOT is deciding the former. Perhaps this shouldn’t come as a surprise in an industry where regulators and the regulated have become accustomed to heavy (government) regulation. If anything, it’s surprising to see the airlines pushing to keep control. Often a blanket rule can reduce airline enforcement costs. Just let the regulator choose a uniform policy–for everything! When trying to keep passengers safe and happy, “federal law” packs a stronger and more objective message than “airline policy” does.