Causal Relationship Between Air Transport and Economic Growth: Evidence from Panel Data for High, Upper-Middle, Lower-Middle and Low-Income Countries (original) (raw)
Related papers
AIR-TRANSPORT AND MACROECONOMIC PERFORMANCE IN ASIAN COUNTRIES: An Analysis
2015
Factors of growth have always been the attention of development economists. This research work investigates the role of air-transport in macroeconomic performance of Asian countries from 1970 to 2014. For this, we resort to econometric techniques, such as Pesaran Cross-Sectional Dependence Test, Cross-Sectional Augmented IPS, Mean Group (MG), Common Correlated Effect Mean Group (CCEMG), Augmented Mean Group (AMG), and Panel Granger Causality. Empirical results confirm the hypothesis that air- transport has a significant role in economic growth of sample countries. Moreover, a feedback effect also exists from macroeconomic performance and air-transport. It is recommended that airtransport sector should be given formal incentive so as to augment its macroeconomic contribution to economic growth.
The Causality Analysis of Air Transport and Socio-economics Factors: The Case of OECD Countries
Transportation Research Procedia, 2017
Air transport is one of the most important industries in the world with its rapid growth, and direct and indirect contribution to world economy. In other words, GDP, tourism and employment are the key factors causing that growth in air transport and an increase in those factors boost the demand for air transport. However, uncertainty in economy, rising unemployment and increased terrorist attacks towards tourism would be a big threat to the growth of air transport in the future. To understand the importance of the mentioned factors, we first aim to apply an econometric approach which is panel Granger causality analysis. To achieve that, data from World Bank data set for OECD countries between the year of 2000 and 2013 is used in this study. We apply Pesaran CDLM test and Friedman’s test which are preferred when the number of units (N) is higher than the time (T) to test cross-sectional dependence and we then perform Granger causality analysis in order to see whether there is a causal relationship (unidirectional or bidirectional) or not among air transport, tourism, economic growth and employment. Econometric results indicate that there is a unidirectional short run causal relationship between economic growth, tourism, employment and air transport and that those factors play an important role in the growth of air transport. In this paper, we also aim to discuss the future challenges for air transport within the frame of econometric results and statistical analysis.
Today, the economic and social effects of the airports on the region they are located are widely accepted throughout the world including Turkey. In developing countries transportation sector is a significant tool of development. Since millennium there has been a great growth in the number of people who prefer air transportation in Turkey. The decrease in the cost of the transportation of both passengers and freight in air transport leads the increase of its accessibility. In this concept when a region has an active airport it helps to increase the region’s competitiveness and support its economic, social and cultural development. The aim of this study is to analyze whether an active airport and its traffic frequency have an effect on country’s macroeconomic indicators. In this study region - fixed effect and two stage least square (2SLS) models are applied with using panel data for 26 sub-regions at NUTS 2 level in Turkey period of 2004 - 2011. The results of this study support that increasing in number of active airports and its traffic frequency have a positive effect on regional economic growth
Causality analysis between GDP growth and air transport indicators in Turkey
2022
In this research; causality analysis between gdp growth and air transport indicators in turkey for the period 1960-2019 will be analyzed. The extent of interaction between some airline data and GDP in Turkey is studied. stationary, johansen co-integration and granger causality tests were conducted to analyze the relations between GDP and air transport data (cargo quantity, number of passengers carried and oil prices) in Turkey. The unit measures of the variables obtained as measurement data in the analyzes; GDP and oil prices are in dollars, the number of passengers carried is in persons and the amount of cargo in tons. In the applied analyzes; the logarithms of the gross domestic product growth rate (GDP), the total number of passengers at the airports in Turkey (PAX), the amount of cargo carried in tons (cargo) and the average annual oil prices (OPEC) are used. Stability tests for examining the relationships between stationary variables in the design phase of the regression model used in the research; has been made. Therefore, with the help of the "Augmented Dickey-Fuller unit root test (ADF)", it was examined whether the variables in the data set used were stationary; It has been determined that all variables of the series have a unit root and therefore are not stationary. As a result of the johansen co-integration test conducted for this study; The calculated trace values and test statistics of the eigenvalue were calculated, it was decided that there were 2 cointegrated equations and it was determined that there were 2 long-term vector relationships between the variables. When the results of the granger causality test are examined; there is a causal relationship between the amount of cargo carried by the gross domestic product However, it has been determined that there is no causal relationship between the fuel price, the total number of passengers carried and the gross domestic product. As a result of this research; it is expected to make significant contributions to the literature empirically on the relationship between aviation and GDP growth in Turkey.
Air transportation usage and economic activity are interdependent. Air transportation provides employment and enables certain economic activities which are dependent on the availability of air transportation services. The economy, in turn, drives the demand for air transportation services resulting in the feedback relationship between the two. The objective of this work is to contribute to the understanding of the relationship between air transportation and economic activity. More specifically, this work seeks to (1) develop a feedback model to describe the relationship between air transportation and economic activity and (2) identify factors which stimulate or suppress air transportation development. To achieve these objectives this work uses an exploratory research method which combines literature review, aggregate data and case study analyses.
Air Transportation Development and Economic Growth in Nigeria
Journal of Economics and Sustainable Development, 2015
This work is an evaluation of the influence of air transport sector development on economic growth in Nigerian. Over the years, various governments of Nigeria have put in place a series of policy instruments for the development of the aviation sector as sinews to bolster the desired growth. But air transport system continues to mirror inefficiency, mismanagement and airline mishap. This study developed a series of econometrics models including dynamic ordinary regression equation, cointegration, error correction model and granger causality techniques to examine the relationship between air transport and economic growth. The analyses suggests a positive influence of air transport on economic growth, a long run equilibrium relationship and a causal unidirectional relations from air transport to economic growth. The diagnostic test for the normality of the model showed that the model functional form is adequate, stable with no serial correlation. From the analysis, this study recommends a proactive and dynamic cohesive transport policy that benefits all the stakeholders. Also, the sector must improve on its managerial expertise guided by adequate transparency and accountability in order to achieve results and develop the sector to an international standard worthy of emulation.
Significance of Air Transport to Tourism-Induced Growth Hypothesis in E7 Economies
Tourism
The study seeks to examine the significance of the tourism-induced growth hypothesis from the perspective of air transportation among seven emerging (E7) countries, including China, India, Brazil, Mexico, Russia, Indonesia, and Turkey. The combined impact of energy consumption and globalization was also factored into the analysis in order to draw cogent implications for environmental quality as energy demand in E7 economies continues to rise amidst growing urbanization in recent times. The study leverages on second-generational panel data estimators, namely cross-sectional autoregressive distributed lag, augmented Mean Group, and Dumitrescu-Hurlin Causality techniques. Having established a long-run equilibrium relationship among the outlined variables, the result validates the pertinent role of air transport in enhancing economic growth as a percent rise in airline passengers' arrivals significantly enhances growth in the E7 economies by 0.77%. In addition, the feedback causalit...
Exploring the Impact of Air Transport on Economic Growth: New Evidence from Australia
Sustainability
The COVID-19 pandemic has impacted all sectors of the tourism industry, particularly air transportation. However, air transport remains an important contributor to economic growth globally. Thus, this study examines whether air transport (a proxy for tourism) stimulates economic growth to validate the air-transportation-led growth hypothesis (ALGH) in the Australian context. To conduct the study, we analyse the asymmetric long-run and short-run impacts of the air passengers carried (a proxy for tourism) on the gross domestic product (GDP) in Australia. We use the nonlinear autoregressive distributed lag (NARDL) modelling approach on data for Australia from 1971 to 2019. We also examined the effects of selected control variables (i.e., energy consumption, financial development, socialisation, and urbanisation) on economic growth. In both the short and long run, we observed statistically significant asymmetric impacts of air transport on economic growth. The positive shocks in air tra...
Impact of Air Transport on the Indonesian Economy
MATEC Web of Conferences, 2018
This study aims to analyze the causal relationship between air transportation and economic growth in Indonesia. The data used are annual time series data from 1990 to 2017 obtained from World Bank. Data analysis method used is method of Vector Error Corection Model (VECM). The results show that there is a relationship between air transport tax and economic growth in Indonesia. Where is the tax of air transport (passenger and goods) and economic growth (GDP). Based on the granger variable or passenger variables test results and the GDP variable indicates that it remains granger-related with significant 1 percent action. Based on these findings it is hoped that further research is suggested to examine the effect of ticket prices or air fares in order to improve economic growth in Indonesia.
Is the Economic Growth of ASEAN-10 related to Air Transportation? A Panel ARDL Approach
Jurnal Ekonomi dan Studi Pembangunan, 2020
Investment in transport infrastructure is one of the important actions to accelerate regional development because it will open access among regions. Thus, it can lead to accelerate economic growth. This study aims to analyze the short-run and long-run relationship between economic growth and air transportation in ASEAN-10 countries. The data used in this study are the number of air transport passengers, air transport carrier, air freights, interactions between passengers and air transport carrier, and gross domestic product growth sourced from World Bank in a year period of 2002-2017. Panel ARDL is used in this analysis. Based on the specification, estimation, and examination of the model, the Panel ARDL is the best choice model. The Panel ARDL model shows that in the short term there is no significant relationship between air transportation and economic growth, but in the long term explains, except air freight, that air transport passengers, air transport airline, and the interaction between passengers have a significant effect on ASEAN-10 economic growth. This study emphasizes that to increase economic growth, increase in air transportation services is an important factor.