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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
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    More about this item

    Keywords

    Air Transport; Low Cost Airlines; Tourist demand;

    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

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