Around the world, the roar of jet engines grows louder. In the last decade, the number of budget airlines has taken off, and low-cost carriers (LCCs) now number in the hundreds globally. While the spectacular growth of the sector has not meant good times for traditional airlines, the economic effects are profound and far-reaching. Over the next decade, the business model that has revolutionized travel in Europe and the Americas will continue to change how people live and work.

Its effects may only now be widespread, but low-cost air travel has a storied history. In 1949, Pacific Southwest Airlines — unrelated to the Texas-based carrier that shares part of its name — started undercutting the major airlines on its one route, from San Diego to Oakland. Its brand and image eventually foreshadowed the irreverent style that typifies LCC marketing today, with smiley-faces painted on the front of its planes and stewardesses in miniskirts. When PSA merged with US Airways almost four decades later, it left behind a model that would be perfected in Texas by Southwest Airlines, which today gets credit for creating the modern low-cost model. Launched in 1971, Southwest first turned a profit three years later and has remained profitable every year since.