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The Magnitudes of Economic and Non-Economic Factors on the Demand for U.S. Domestic Air Travel

Author

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  • Park, Ju D.
  • Koo, Won W.

Abstract

The primary purpose of this study is to analyze air carriers’ behavior in capturing market share by examining the economic factors affecting passenger behavior toward air travel. This study also examines non-economic factors such as seasonality, unexpected events (9/11 attack), mergers, and trends. Because the airlines included in this study compete with each other, seemingly unrelated regression estimation (SURE) is used to estimate the parameters of the demand models which have correlated error terms. The economic and statistical relationship of the factors with air passenger miles provides valuable information to understand the nature of the demand for the U.S. air passenger industry. In examining demand determinants, this study concludes that air fare, income, seasonality, and mergers play significant roles in determining the demand for air passengers.

Suggested Citation

  • Park, Ju D. & Koo, Won W., 2014. "The Magnitudes of Economic and Non-Economic Factors on the Demand for U.S. Domestic Air Travel," Journal of the Transportation Research Forum, Transportation Research Forum, vol. 53(3).
    • Handle: RePEc:ags:ndjtrf:207443
    DOI: 10.22004/ag.econ.207443
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    File URL: https://ageconsearch.umn.edu/record/207443/files/2014v53n3_04_DomesticAirTravel.pdf
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    References listed on IDEAS

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    1. Brons, Martijn & Pels, Eric & Nijkamp, Peter & Rietveld, Piet, 2002. "Price elasticities of demand for passenger air travel: a meta-analysis," Journal of Air Transport Management, Elsevier, vol. 8(3), pages 165-175.
    2. Nelson, Larry A. & Dickey, David A. & Smith, Joy M., 2011. "Estimating time series and cross section tourism demand models: Mainland United States to Hawaii data," Tourism Management, Elsevier, vol. 32(1), pages 28-38.
    3. Chi, Junwook & Baek, Jungho, 2012. "A dynamic demand analysis of the United States air-passenger service," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 48(4), pages 755-761.
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    Cited by:

    1. Wang, Sen & Gao, Yi, 2021. "A literature review and citation analyses of air travel demand studies published between 2010 and 2020," Journal of Air Transport Management, Elsevier, vol. 97(C).

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