A leading indicator approach to predicting short-term shifts in demand for business travel by air to and from the UK
This paper uses the probit model to examine whether leading indicator information could be used for the purpose of predicting short-term shifts in demand for business travel by air to and from the UK. Leading indicators considered include measures of business expectations, availability of funds for corporate travel and some well-known macroeconomic indicators. The model performance is evaluated on in- and out-of-sample basis, as well as against a linear leading indicator model, which is used to mimic the current forecasting practice in the air transport industry. The estimated probit model is shown to provide timely predictions of the early 1980s and 1990s industry recessions and is shown to be more accurate than the benchmark linear model. Copyright © 2005 John Wiley & Sons, Ltd.
Volume (Year): 24 (2005)
Issue (Month): 6 ()
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- Maximo Camacho & Gabriel Perez-Quiros, 2002.
"This is what the leading indicators lead,"
Journal of Applied Econometrics,
John Wiley & Sons, Ltd., vol. 17(1), pages 61-80.
- Maximo Camacho & Gabriel Perez-Quiros, 2000. "This Is What The Leading Indicators Lead," Computing in Economics and Finance 2000 132, Society for Computational Economics.
- 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.
- Mills,Terence C., 1991. "Time Series Techniques for Economists," Cambridge Books, Cambridge University Press, number 9780521405744, Diciembre.
- Birchenhall, Chris R, et al, 1999. "Predicting U.S. Business-Cycle Regimes," Journal of Business & Economic Statistics, American Statistical Association, vol. 17(3), pages 313-323, July. Full references (including those not matched with items on IDEAS)
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