Unit 3: Supply side policy: Deregulation of transatlantic air routes

This BBC video explains the new deal between the US and Europe aiming to open up air travel between the two continents.

< http://www.bbc.co.uk/mediaselector/check/player/nol/newsid_7320000/newsid_7321100?redirect=7321163.stm&news=1&nbwm=1&bbwm=1&bbram=1&nbram=1&asb=1 >

a) Why would this action be regarded as a supply side policy?
b) Using a diagram, explain the potential effects on the European and American economies of this action