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Last month, the FAA came out in favor of “urban air mobility corridors”–point-to-point aerial highways that new eVTOL, helicopter, and passenger drones will use. It’s a great proposal, but the FAA’s plan for allocating and sharing those corridors is largely to let the industry negotiate it among themselves (the “Community Business Rules”):
Operations within UAM Corridors will also be supported by CBRs collaboratively developed by the stakeholder community based on industry standards or FAA guidelines and approved by the FAA.
This won’t end well, much like Congress and the Postmaster General letting the nascent airlines in the 1930s divvy up air routes didn’t end well–we’re still living with the effects of those anticompetitive decisions. Decades later the FAA is still refereeing industry fights over routes and airport access.
Rather, regulators should create airspace markets because otherwise, as McKinsey analysts noted last year about urban air mobility:
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Airspace today is a common-pool resource rationed via regulation and custom. But with drones, eVTOL, and urban air mobility, congestion will increase and centralized air traffic control will need to give way to a more federated and privately-managed airspace system. As happened with spectrum: a demand shock to an Ostrom-ian common pool resource should lead to enclosure and “propertization.”
Markets in airspace probably should have been created decades ago once airline routes became fixed and airports became congested. Instead, the centralized, regulatory rationing led to large economic distortions:
For example, in 1968, nearly one-third of peak-time New York City air traffic–the busiest region in the US–was general aviation (that is, small, personal) aircraft. To combat severe congestion, local authorities raised minimum landing fees by a mere $20 (1968 dollars) on sub 25-seat aircraft. General aviation traffic at peak times immediately fell over 30%—suggesting that a massive amount of pre-July 1968 air traffic in the region was low-value. The share of aircraft delayed by 30 or more minutes fell from 17% to about 8%.
This pricing of airspace and airport access was half-hearted and resisted by incumbents. Regulators fell back on rationing via the creation of “slots” at busy airports, which were given mostly to dominant airlines. Slots have the attributes of property–they can be defined, valued, sold, transferred, borrowed against. But the federal government refuses to call it property, partly because of the embarrassing implications. The GAO said in 2008:
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It may be too late to have airspace and route markets for traditional airlines–but it’s not too late for drones and urban air mobility. Demarcating aerial corridors should proceed quickly to bring the drone industry and services to the US. As Adam has pointed out, this is a global race of “innovation arbitrage”–drone firms will go where regulators are responsive and flexible. Federal and state aviation officials should not give away valuable drone routes, which will end up going to first-movers and the politically powerful. Airspace markets, in contrast, avoid anticompetitive lock-in effects and give drone innovators a chance to gain access to valuable routes in the future.
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Law journal article. The North Carolina JOLT published my article, “Auctioning Airspace,” in October 2024. I argued for the FAA to demarcate and auction urban air mobility corridors (SSRN).
Mercatus white paper. In March 2024 Connor Haaland and I explained that federal and state transportation officials 快帆Speedin apk file | ApkFiles.com:Download free apk file 『全新上线，免费使用』 「快帆」是一款免费帮助海外华人用户翻墙回国内高速访问中国网络的VPN加速软件，可众让境外华人从国外直连到中国国内，无论在世界何处，都可众无任何限制的使用酷狗、网易云音乐、QQ音乐、优 because many state laws allow local and state authorities to lease such airspace.
Law journal article. A student note in a 2024 免费翻国外墙的app issue discusses airspace leasing for drone operations (pdf).
FAA report. The FAA’s Drone Advisory Committee in March 2018 took up the idea of auctioning or leasing airspace to drone operators as a way to finance the increased costs of drone regulations (pdf).
免费翻国外墙的app The GAO reviewed the idea of auctioning or leasing airspace to drone operators in a December 2024 report (pdf).
Airbus UTM white paper. The Airbus UTM team reviewed the idea of auctioning or leasing airspace to UAM operators in a March 2024 report, “Fairness in Decentralized Strategic Deconfliction in UTM” (pdf).
Federalist Society video. I narrated a video for the Federalist Society in July 2024 about airspace design and drone federalism (YouTube).
Mercatus Center essay. Adam Thierer, Michael Koutrous, and Connor Haaland 快帆翻国外加速软件 drone industry red tape how the US can’t have “innovation by regulatory waiver,” and how to accelerate widespread drone services.
I’ve discussed the idea in several outlets and events, including:
- Wall Street Journal op-ed
- 2024 Global Air Traffic Management Conference panel
- A Harvard Law School drone policy event
- 在国内怎么翻国外app magazine essay
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- In a Federalist Society podcast episode, Adam Thierer and I discussed airspace markets and drone regulation with US Sen. Mike Lee. (Sen. Lee has introduced a bill to draw a line in the sky at 200 feet in order to clarify and formalize federal, state, and local powers over low-altitude airspace.)
- Tech Policy Institute podcast episode with Sarah Oh, Eli Dourado, and Tom Lenard.
- Macro Musings 在国内怎么翻国外app episode with David Beckworth.
- Drone Radio Show podcast episode with Randy Goers.
- Drones in America 在国内怎么翻国外app episode with Grant Guillot.
- Uncommon Knowledge podcast episode with Juliette Sellgren.
- Building Tomorrow podcast episode with Paul Matzko and Matthew Feeney.
- sUAS News podcast episode and interview.
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On July 23rd, the U.S. Department of Transportation (DoT) released Pathways to the Future of Transportation, which was billed as “a policy document that is intended to serve as a roadmap for innovators of new cross modal technologies to engage with the Department.” This guidance document was created by a new body called the Non-Traditional and Emerging Transportation Technology (NETT) Council, which was formed by U.S. Transportation Secretary Elaine L. Chao last year. The NETT Council is described as “an internal deliberative body to identify and resolve jurisdictional and regulatory gaps that may impede the deployment of new technologies.”
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I was very sad to learn that James Gattuso 
The Technology Liberation Front is the tech policy blog dedicated to keeping politicians' hands off the 'net and everything else related to technology.