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Airports and Urban Growth: Evidence from a Quasi-Natural Policy Experiment

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  • Bruce A. Blonigen
  • Anca D. Cristea

Abstract

While significant work has been done to examine the determinants of regional development, there is little evidence on the contribution of air services toward this outcome. This paper exploits the unexpected market changes induced by the 1978 Airline Deregulation Act to bring new evidence on the link between airline traffic and local economic growth. Using data for almost 300 Metropolitan Statistical Areas (MSAs) over a two decade time period centered around the policy change, we exploit time variation in long-run growth rates to identify the effects of airline traffic on population, income and employment growth. Our results suggest that air service has a significant positive effect on regional growth, with the magnitude of the effects differing by MSA size and industrial specialization.

Suggested Citation

  • Bruce A. Blonigen & Anca D. Cristea, 2012. "Airports and Urban Growth: Evidence from a Quasi-Natural Policy Experiment," NBER Working Papers 18278, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:18278
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    Cited by:

    1. Yan, Jia & Oum, Tae Hoon, 2014. "The effect of government corruption on the efficiency of US commercial airports," Journal of Urban Economics, Elsevier, vol. 80(C), pages 119-132.
    2. Sheard, Nicholas, 2014. "Airports and urban sectoral employment," Journal of Urban Economics, Elsevier, vol. 80(C), pages 133-152.
    3. Arnarson, Björn Thor, 2015. "Bridging Trade Barriers: Evaluating Models of Multi-Product Exporters," Working Papers 2015:6, Lund University, Department of Economics, revised 14 Oct 2016.
    4. Nicholas Sheard, 2015. "Airport Improvements and Urban Growth," ERSA conference papers ersa15p28, European Regional Science Association.
    5. Michael, Bryane, 2013. "Who Is Your Company? Where to Locate to Compete in Emerging Markets," EconStor Preprints 108998, ZBW - German National Library of Economics.
    6. Nicholas Sheard, 2015. "Airport Improvements and Urban Growth," AMSE Working Papers 1509, Aix-Marseille School of Economics, Marseille, France.
    7. Xavier Fageda & Marta Gonzalez-Aregall, 2014. "“The Spatial effects of transportation on industrial employment ”," IREA Working Papers 201429, University of Barcelona, Research Institute of Applied Economics, revised Nov 2014.
    8. Philipp Breidenbach, 2015. "Expansions of Regional Airports and their Effect on the Local Economy," ERSA conference papers ersa15p1196, European Regional Science Association.
    9. Francesco David & Giuseppe Saporito, 2017. "The impact of a new airport on international tourism: the case of Ragusa (Sicily)," Questioni di Economia e Finanza (Occasional Papers) 412, Bank of Italy, Economic Research and International Relations Area.

    More about this item

    JEL classification:

    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • R4 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics

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