IDEAS home Printed from https://ideas.repec.org/p/aee/wpaper/1404.html
   My bibliography  Save this paper

Mixed effects of low-cost airlines on tourism in Spain

Author

Listed:
  • Rafael L. Myro

    (Universidad Complutense de Madrid, Departamento de Economía Aplicada II)

  • Belén Rey

    (Universidad Complutense de Madrid, Departamento de Economía Aplicada II)

  • Pablo I. Hernández

    (Universidad Carlos III)

Abstract

This article presents an estimate of the impact of low-cost airlines on Spanish tourism arriving from the principal EU-15 member states during the first decade of the 21st century by means of a multivariate analysis of tourist demand. The effects of low-cost companies (LCCs) on expenditure and on the number of tourists are separated. The expansion in low-cost airlines have had a positive and strong effect on the number of tourists but seems not to have influenced at all the aggregate expenditure made by them as the expenditure by tourist has decreased perhaps due to an increasing number of tourist with higher frugality or lesser income. This result could be regarded as a useful guide to policy makers when they subsidize LCCs.

Suggested Citation

  • Rafael L. Myro & Belén Rey & Pablo I. Hernández, 2014. "Mixed effects of low-cost airlines on tourism in Spain," Working Papers 14-04, Asociación Española de Economía y Finanzas Internacionales.
    • Handle: RePEc:aee:wpaper:1404
    as

    Download full text from publisher

    File URL: http://www.aeefi.com/RePEc/pdf/defi14-04.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Gillen, David & Morrison, William, 2003. "Bundling, integration and the delivered price of air travel: are low cost carriers full service competitors?," Journal of Air Transport Management, Elsevier, vol. 9(1), pages 15-23.
    2. William Maloney & Gabriel V. Montes Rojas, 2005. "How elastic are sea, sand and sun? Dynamic panel estimates of the demand for tourism," Applied Economics Letters, Taylor & Francis Journals, vol. 12(5), pages 277-280.
    3. Rey, Belén & Myro, Rafael L. & Galera, Asun, 2011. "Effect of low-cost airlines on tourism in Spain. A dynamic panel data model," Journal of Air Transport Management, Elsevier, vol. 17(3), pages 163-167.
    4. Franke, Markus, 2004. "Competition between network carriers and low-cost carriers—retreat battle or breakthrough to a new level of efficiency?," Journal of Air Transport Management, Elsevier, vol. 10(1), pages 15-21.
    5. Casadesus-Masanell, Ramon & Ricart, Joan E., 2007. "Competing through business models," IESE Research Papers D/713, IESE Business School.
    6. Steven A. Morrison, 2001. "Actual, Adjacent, and Potential Competition Estimating the Full Effect of Southwest Airlines," Journal of Transport Economics and Policy, University of Bath, vol. 35(2), pages 239-256, May.
    7. Pels, Eric & Rietveld, Piet, 2004. "Airline pricing behaviour in the London–Paris market," Journal of Air Transport Management, Elsevier, vol. 10(4), pages 277-281.
    8. Manuel Arellano & Stephen Bond, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 58(2), pages 277-297.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Khan, Nokhaiz Tariq & Jung, Gisun & Kim, Jaebum & Kim, Yun Bae, 2019. "Evolving competition between low-cost carriers and full-service carriers: The case of South Korea," Journal of Transport Geography, Elsevier, vol. 74(C), pages 1-9.
    2. Nuno Carlos LEITÃO & Muhammad SHAHBAZ, 2012. "Migration and Tourism Demand," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania - AGER, vol. 0(2(567)), pages 39-48, February.
    3. Faruk Balli & Hatice O. Balli & Nikau Tangaroa, 2015. "Research Note: The Impact of Marketing Expenditure on International Tourism Demand for the Cook Islands," Tourism Economics, , vol. 21(6), pages 1331-1343, December.
    4. Dudás, Gábor & Boros, Lajos & Pál, Viktor & Pernyész, Péter, 2016. "Analysis of the lowest airfares considering the different business models of airlines, the case of Budapest," MPRA Paper 74502, University Library of Munich, Germany.
    5. Albaladejo, Isabel P. & González-Martínez, María Isabel & Martínez-García, María Pilar, 2016. "Nonconstant reputation effect in a dynamic tourism demand model for Spain," Tourism Management, Elsevier, vol. 53(C), pages 132-139.
    6. Lieshout, Rogier & Malighetti, Paolo & Redondi, Renato & Burghouwt, Guillaume, 2016. "The competitive landscape of air transport in Europe," Journal of Transport Geography, Elsevier, vol. 50(C), pages 68-82.
    7. Myongjin Kim & Qihong Liu & Nicholas G. Rupp, 2023. "When Do Firms Offer Higher Product Quality? Evidence from the Allocation of Inflight Amenities," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 62(2), pages 149-177, March.
    8. Diaconu Maxim Laura, 2012. "The Development of the Low-Cost Carriers’ Business Models. Southwest Airlines Case Study," Scientific Annals of Economics and Business, Sciendo, vol. 59(1), pages 231-238, July.
    9. Zuidberg, Joost, 2014. "Identifying airline cost economies: An econometric analysis of the factors affecting aircraft operating costs," Journal of Air Transport Management, Elsevier, vol. 40(C), pages 86-95.
    10. Gawande, Kishore & Maloney, William & Montes-Rojas, Gabriel, 2009. "Foreign informational lobbying can enhance tourism: Evidence from the Caribbean," Journal of Development Economics, Elsevier, vol. 90(2), pages 267-275, November.
    11. Malighetti, Paolo & Paleari, Stefano & Redondi, Renato, 2010. "Has Ryanair's pricing strategy changed over time? An empirical analysis of its 2006–2007 flights," Tourism Management, Elsevier, vol. 31(1), pages 36-44.
    12. Juan Gomez & José Manuel Vassallo, 2020. "Has heavy vehicle tolling in Europe been effective in reducing road freight transport and promoting modal shift?," Transportation, Springer, vol. 47(2), pages 865-892, April.
    13. Ng, Kam To & Fu, Xiaowen & Lee, Jaewoon & Yamaguchi, Katsuhiro & Zhu, Chuanyan, 2023. "The Effects of Bankruptcy on Airline Yield and Frequency: The case of the duopolistic domestic market in Japan," Transport Policy, Elsevier, vol. 142(C), pages 28-36.
    14. Balli, Faruk & Civan, Abdulkadir & Uras, Oguz, 2015. "The impact of the Hizmet movement on Turkey's bilateral trade," Economic Modelling, Elsevier, vol. 45(C), pages 74-82.
    15. Fageda, Xavier & Jiménez, Juan Luis & Perdiguero, Jordi & Marrero, Kevin, 2017. "Does market exit of a network airline affect airline prices and frequencies on tourist routes?," Tourism Management, Elsevier, vol. 61(C), pages 465-471.
    16. Juan Gomez & José Manuel Vassallo & Israel Herraiz, 2016. "Explaining light vehicle demand evolution in interurban toll roads: a dynamic panel data analysis in Spain," Transportation, Springer, vol. 43(4), pages 677-703, July.
    17. Marco Alderighi & Alessandro Cento & Peter Nijkamp & Piet Rietveld, 2011. "Second-degree Price Discrimination and Inter-group Effects in Airline Routes between European Cities," Tinbergen Institute Discussion Papers 11-118/3, Tinbergen Institute.
    18. Nuno, Carlos Leitão & Muhammad, Shahbaz, 2011. "Migration and Tourist Flows," MPRA Paper 34905, University Library of Munich, Germany, revised 12 Nov 2011.
    19. Santana-Jiménez, Yolanda & Hernández, Juan M., 2011. "Estimating the effect of overcrowding on tourist attraction: The case of Canary Islands," Tourism Management, Elsevier, vol. 32(2), pages 415-425.
    20. Fay Dunkerley & Andre De Palma & Stef Proost, 2009. "Spatial Asymmetric Duopoly With An Application To Brussels' Airports," Journal of Regional Science, Wiley Blackwell, vol. 49(3), pages 529-553, August.

    More about this item

    Keywords

    Air Transport; Low Cost Airlines; Tourist demand;
    All these keywords.

    JEL classification:

    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism
    • L93 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Air Transportation

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aee:wpaper:1404. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Luis Miguel del Corral Cuervo (email available below). General contact details of provider: https://edirc.repec.org/data/aeefiea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.