For This We Need Academics?

This morning’s London Freeps (online) included an article on a topic of some importance to most Canadians; airline travel. It is titled ‘Harvey: More airline competition won’t solve Canada’s aviation challenges’ and is written by one Geraint Harvey, ‘Special to The Free Press’. (Note that it was posted before the AC flight attendants went on strike. It is not about that.)

Harvey is DANCAP Private Equity Chair in Human Organization at UWO, which means he is a faculty member in the DAN Department in the Faculty of Social Science. DAN is the name that department adopted after Aubrey Dan gave it a big donation some years back. Why it is in ALL CAPS I have never understood. The department runs the pseudo-business program in the Social Science Faculty, so it competes with the IVEY (actually, they refer to themselves as the Ivey School, as you would expect) program across the road for students and prestige. Both programs are a pox on the University, in my humble opinion, but my topic here is this article written by Harvey. The punchline: he should be ashamed of himself.

What this article is trying to say is, I think, stated well in the subtitle of the piece: Canadians must be certain lower fares that result from increased competition are worth the costs, an[sic] Western University academic says.

I don’t expect Harvey wrote either the headline above or that subtitle, but the latter does capture the point of the article. What prompted the piece was the fact that Canada’s Competition Bureau has just released a study of the Canadian airline industry, which you can read and download here yourself.

It’s a long and complex report, and it does indicate that The Bureau believes more competition is needed in Canada’s air travel market. How that might be achieved is again a complex part of the study, and Harvey’s point is – so far as I can tell – if increased competition does reduce airfares, it may come at the cost of other bad things happening.

So far, so good. Harvey is an academic, but this is a newspaper article (first published in The Conversation, apparently) so it cannot be expected to be written up to academic standards. My problem here is that the article is not even up to the standards we should expect of journalists. That an academic would write something so shoddy, well – it just frosts my bum.

Let me count the ways.

Harvey notes that the CB report states that one big complaint Canadians have about air travel is the prevalence of hidden fees for luggage and such, and the complex structure of air fares themselves. Then he writes this:

But it’s unreasonable to expect increased competition — when airlines seek to make their offering more attractive than their competitors — to lead to greater transparency in Canada. In fact, competition has been linked theoretically and empirically to dishonest practices.

Yes, there is a link in that last sentence, to some research. Sort of. It is a link to an online paper titled ‘Competition increases the magnitude of dishonest reporting even when controlling for reward uncertainty’ in Scientific Reports.

It has nothing to do with the airline industry, or in fact with any industry on planet earth. It is a report of what happened when some researchers (not including Harvey) had 766 subjects sit in front of a computer screen and play a game. Here’s their description of said game:

We conducted a pre-registered experiment (https://aspredicted.org/kyxz-b4gb.pdf) that relied on the recently introduced “spot-the-difference task”^27,28. In the spot-the-difference task participants are presented with 20 pairs of images that have some differences between them (see Fig. 1). Participants score points if they report seeing three differences between images, but unbeknownst to them, 10 pairs of images have only two differences between them. Thus, participants can achieve scores above 50% only by dishonestly reporting seeing three differences where only two exists. The only experimental manipulation is the way scores are converted into monetary payment at the end of the experiment.

No doubt this has a lot to teach us about the impact of increased competition in the airline industry.

This is what I mean by shoddy. Harvey found one barely related study that gives the result he wants – competition causes dishonesty – and stops. I typed ‘airline competition’ into google scholar and up came thousands of actual research papers on it. The first that google gave me, published in June of ’24, was titled ‘Airline competition: A comprehensive review of recent research’.

That paper had more than 100 references to other research papers at the end. But digging through all those to see if anyone has actually studied the impact of competition in airline markets on fee disclosure and structure, well, that would take some time and effort, right?

Harvey then writes:

Europe provides a cautionary example. Increased competition has not led to greater air fare transparency. Airlines like Ryanair, a low-fare airline and the continent’s largest airline by passengers carried, have been accused of hiding fees for passengers.

Yes, another link, this time to a story in something called Euronews titled ‘Is it always cheaper to buy a low-cost airfare? Here are the hidden charges to watch out for’

The article does not ‘accuse’ Ryanair of anything, It provides a ranking of how much your total air travel cost can go up at various airlines on average due to added charges, and Ryanair did come out on top on that scale, with Wizz Air next and Easy Jet coming in third. It also says ‘Carriers including Pegasus Airlines, Loganair and Icelandair have the least hidden fees, though their original airfare starts at a higher price’. Pretty much what one would expect, right? What the Euronews article does not do, or claim to do, is address the question of what impact the increased airline competition that arose in Europe over the years had on the size and prevalence of those fees. Nor is there any comparison of the size of those fees in Europe versus in Canada.

But here’s the thing. The Competition Bureau report has a big section on the fees and charges issue. At no point does it even suggest that more competition will fix this. Here is what the CB report concludes about this issue:

What we considered and why this is hard to fix

We looked at multiple approaches to improve how flight information is shared and displayed, including stakeholder proposals. Our study found that each potential solution presented limitations and risks. In this section, we do not recommend specific changes. We do discuss the approaches we have considered and what they would mean for the industry.

So, either Harvey did not bother to read the CB report, or he just wanted to construct a straw man he could easily knock down. Neither is appropriate behaviour for an academic.

More from our guy:

Those who suffer the most from airlines minimizing costs are employees, because labour represents one of the few areas where airlines can cut back.

The morality and safety implications of introducing wage and employment insecurity to workers within high reliability organizations aside, reducing the quality of employment terms and conditions for workers in such an important industry is short-sighted.

Here we go again. The first link in this piece is to another article Harvey wrote himself for The Conversation about the Westjet strike back in 2023. Self-referential, in other words. The second link is to a rather esoteric discussion about the relationship between ‘high reliability organizations’ and risk management schemes. I cannot for the life of me figure out what that second article has to do with competition in the Canadian airline industry. However, what Harvey is trying to say, if badly, is that more competition will lead to airlines reducing their employee rolls. That may be and it may be a problem if it happens. What is missing is evidence. For example, what happened to employment in European airlines when that market opened up many years ago? Looking into that would be rather more labour-intensive than just pointing at a journalism article you wrote yourself a couple of years ago.

The article itself includes the following statement by Harvey: “Deregulation has ultimately reduced the supply of pilots, creating a tighter labour market.”

He provides neither facts nor arguments to support this claim, and it is not at all obvious why de-regulating the airline industry would reduce the number of people willing to be an airline pilot. I suppose if you think de-regulation reduces pilot salaries, then it might. Harvey’s article on the Westjet strike in The Conversation also has a bunch of links in it, and so I started following them. I probably did an hour of reading through all this, and here’s the thing – it’s all journalism, mostly from CBC News. This is the kind of source material an academic is citing? No actual research trying to establish what the impact of de-regulation might be on pilot supply or demand?

Additionally, in one of those CBC articles, one finds the following quote:

“New federal rules around pilot fatigue could make the problem worse as airlines may have to hire substantially more pilots to maintain current flight schedules, industry representatives and observers say.”

And then there’s this quote:

“Air Canada receives “thousands of applications far exceeding vacancies in every round of pilot hiring,” it said in a statement.”

So, here’s someone saying a new regulation is making the ‘pilot shortage’ worse, and then AC saying they can’t hire all the applicants they get.

But more to the point, look at the kind of material Harvey is referencing in his article. It is all (shoddy, in my view) journalism, full of ‘observers say’ and  ‘some in the industry say’ and other unsupported, anonymous assertions. We need academics to write articles like this, completely lacking in any evidence? A journalism intern can do that – although they shouldn’t, either.

Last one, I promise.

A real issue in a sprawled out country like Canada is air connections – hell, any connections – to remote, low-population areas. Harvey admits in the article, ‘To its credit, the bureau offers several recommendations for northern and remote communities’. But then he goes on to write ‘But these communities are unlikely to benefit from competition alone’.

Again, the Bureau report does not say they will.

Harvey has to take one more shot at the idea of competition, however, writing:

Europe’s airline industry is once again instructive. Eurocontrol, a pan-European organization dedicated to the success of commercial aviation, states that “domestic aviation in Europe has experienced a substantial and persistent decline over the past two decades,” including the demise of regional operators serving lower-density routes.

Ok, let’s go once again to the article in that link.

It does indeed say what Harvey writes above. What he does not tell you is that it also says this:

The number of flights in Europe’s top 12 domestic markets has fallen by approximately 1.5 million compared to their historical peak, a reduction equivalent to 14% of total European flight volumes – although the drop in passengers flown domestically is less pronounced, as larger aircraft are often being used to operate the remaining routes….

The trend has not been driven by a single factor, but rather by a combination of structural, infrastructural, and behavioural or policy-related changes, such as:

• • more point-to-point international travel

  • the collapse of some regional carriers

  • the development of high-speed rail, improved road infrastructure, and intermodal solutions, all of which have reduced the competitiveness of short-haul flights

  • changes in business travel habits, growing environmental concerns, and government interventions (such as taxes and flight bans).

As they say – ‘it’s complicated’. Not, however, to someone who appears to have started out with the certainty that ‘competition is bad’, like Our Man Harvey.

To be sure, the best way to improve Canadian air travel is by no means clear, and the Bureau report is quite frank about that. Allowing foreign airlines to fly domestic Canadian routes is often mentioned as a solution, and Harvey notes with alarm the idea of having an airline like Qatar Airways fly such routes in Canada, given that it is subsidized by its government. This is indeed an issue, as it is in almost all sectors of international trade, from agriculture to computer chips. And, make no mistake, international trade is what we are talking about: letting Canadians buy a service – air travel – from a foreign provider. However, it should be noted that Qatar Airways already competes (‘unfairly’ according to Harvey) with many airlines on international routes. In fact, QA competes with Air Canada on those routes, flying out of Toronto Pearson. One might ask – what has been the impact of that competition on international air travel?

That would be a question worthy of serious investigation. I am sure such an investigation will not come from Professor Harvey.