Before the Airline Deregulation Act of 1978, which agency regulated airline economics in the U.S.?

The Civil Aeronautics Board (CAB) was the agency responsible for regulating airline economics in the United States before the passage of the Airline Deregulation Act of 1978. The CAB had the authority to oversee rates, routes, and the financial stability of airlines, ensuring that air carriers adhered to government-established prices and operating certifications.

The CAB's role was significant at that time because it aimed to promote a stable and reliable air transportation system, often acting to prevent practices that could lead to unfair competition among carriers. However, the agency's regulatory approach was a major factor that led to debates about market efficiency and the need for more competition in the airline industry, thus paving the way for deregulation.

The National Transportation Safety Board (NTSB) primarily handles accident investigations and safety issues rather than economic regulation. The Federal Aviation Administration (FAA) focuses on the safety of civil aviation and air traffic management, while the Department of Transportation (DOT) oversees broader transportation policies and initiatives, but did not specifically manage airline economics prior to deregulation. Consequently, the CAB is identified as the correct answer, as it was directly responsible for regulating all economic aspects of the airline industry before deregulation took place.