Free Sky and Clouds of Restrictions
AbstractAn increasing percentage of trade occurs via air. However, air services are excluded from the WTO Agreement and, as a result, the aviation market is regulated by a plethora of Air Services Agreements. In this paper, we investigate the extent of discrimination -in terms of access to international air services- generated by this system. In particular, using recently available information on Air Services Agreements for 184 countries, we estimate the impact of international air services liberalization on air passenger flows. We find that increasing the degree of liberalization has a positive and significant effect. For instance, the higher degree of air services liberalization among countries of the European Economic Area (EEA) is estimated to account for approximately 30 per cent higher intra-EEA passenger traffic compared with countries that signed Open Skies-type agreements. Our results are robust to the use of several measures of liberalization as well as alternative estimation techniques that address potential problems of endogeneity, heteroscedasticity and data inaccuracy.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by University of Munich, Department of Economics in its series Discussion Papers in Economics with number 10944.
Date of creation: 14 Jul 2009
Date of revision:
Air Services Agreements; Air services liberalization; Air passenger traffic; Regulatory quality.;
Find related papers by JEL classification:
- F15 - International Economics - - Trade - - - Economic Integration
- L93 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Air Transportation
- R48 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - Government Pricing and Policy
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-07-28 (All new papers)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- David Hummels, 2007. "Transportation Costs and International Trade in the Second Era of Globalization," Journal of Economic Perspectives, American Economic Association, vol. 21(3), pages 131-154, Summer.
- J. M. C. Santos Silva & Silvana Tenreyro, 2006.
"The Log of Gravity,"
The Review of Economics and Statistics,
MIT Press, vol. 88(4), pages 641-658, November.
- Joao Santos Silva & Silvana Tenreyro, 2005. "The log of gravity," LSE Research Online Documents on Economics 3744, London School of Economics and Political Science, LSE Library.
- Joao Santos Silva & Silvana Tenreyro, 2005. "The Log of Gravity," CEP Discussion Papers dp0701, Centre for Economic Performance, LSE.
- Santos Silva, Joao & Tenreyro, Silvana, 2005. "The Log of Gravity," CEPR Discussion Papers 5311, C.E.P.R. Discussion Papers.
- James E. Rauch & Vitor Trindade, 2002.
"Ethnic Chinese Networks In International Trade,"
The Review of Economics and Statistics,
MIT Press, vol. 84(1), pages 116-130, February.
- S. Baranzoni & P. Bianchi & L. Lambertini, 2000. "Market Structure," Working Papers 368, Dipartimento Scienze Economiche, Universita' di Bologna.
- Giuseppe Nicoletti & Stefano Scarpetta & Olivier Boylaud, 2000. "Summary Indicators of Product Market Regulation with an Extension to Employment Protection Legislation," OECD Economics Department Working Papers 226, OECD Publishing.
- Rauf Gönenç & Giuseppe Nicoletti, 2001.
"Regulation, market structure and performance in air passenger transportation,"
OECD Economic Studies,
OECD Publishing, vol. 2001(1), pages 183-227.
- Rauf Gönenç & Giuseppe Nicoletti, 2000. "Regulation, Market Structure and Performance in Air Passenger Transportation," OECD Economics Department Working Papers 254, OECD Publishing.
- James E. Anderson & Eric van Wincoop, 2000.
"Gravity with Gravitas: A Solution to the Border Puzzle,"
Boston College Working Papers in Economics
485, Boston College Department of Economics.
- James E. Anderson & Eric van Wincoop, 2003. "Gravity with Gravitas: A Solution to the Border Puzzle," American Economic Review, American Economic Association, vol. 93(1), pages 170-192, March.
- James E. Anderson & Eric van Wincoop, 2001. "Gravity with Gravitas: A Solution to the Border Puzzle," NBER Working Papers 8079, National Bureau of Economic Research, Inc.
- Micco, Alejandro & Serebrisky, Tomas, 2006.
"Competition regimes and air transport costs: The effects of open skies agreements,"
Journal of International Economics,
Elsevier, vol. 70(1), pages 25-51, September.
- Alejandro Micco & Tomás Serebrisky, 2008. "Competition Regimes and Air Transport Costs: The Effects of Open Skies Agreement," IDB Publications 46738, Inter-American Development Bank.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Alexandra Frank).
If references are entirely missing, you can add them using this form.