When we talk about the system of air transport regulation we normally refer to the processes by which governments exercise authority over the licensing of airlines to routes and control the fares and rates which are charged on those routes. Sometimes the concept of air transport regulation is extended to embrace the controls which governments exercise over the technical standards of airline operations, and thus include the licensing of personnel and the certification of airworthiness standards. In this lecture I propose to use the term “air transport regulatory system” in a much broader sense. I want the term to be interpreted as meaning the total system by which all relevant aspects of public policy are brought to bear upon airline operations and the ways in which they influence the air services which are available to the travelling public. Under this definition of air transport regulation I shall, for example, include governmental interests in promoting a high rate of technological progress in aeronautics as part of the overall system.