, impose slot constraints and allocate slots among individual airlines through administrative action.
             Despite the efforts of the FAA, political pressure began to mount for a change in the system of slot allocation to a market approach driven by supply and demand of the airlines to purchase or sell slots. After years of political debate, the Department of Transportation is charged with deciding the most efficient allocation of these increasingly scarce resources at airports across the country. Elizabeth Dole, Secretary of Transportation, must determine whether the current system of scheduling committees is an efficient means of allocating slots or whether shifting to a market approach would be a more effective system. This memo considers the current alternatives Secretary Dole faces and offers the recommendation as stated in the above summary section. The current situation is influenced by the differing views espoused by the various stakeholders and a series of political events leading up to the present situation.
             There are several stakeholders supporting various and opposing alternatives. The major airlines have a vested interest in maintaining their current slot allocation with the potential to acquire more slots as they grow. Smaller carriers want to ensure that they also have the rights to slots without being over-powered by the larger and wealthier airlines. The FAA feels a responsibility to protect smaller carriers while keeping the larger, politically influential airlines happy and do all this without having to manage a burdensome and highly bureaucratic system of allocation. Other government agencies have become involved from an economic advisement standpoint in an effort to correct what they view as a government failure or the potential onset of a failure if the current system does not undergo change.
             The deregulation of airline pricing in 1981 and the recent inauguration of a Republican administration sparked the...