Do non-stop flights boost exports?
We study empirically the role of air service in boosting exports. We focus on the link between non-stop flights and outgoing trade of the Italian manufacturing sector in Europe using a panel of 12,000 half- yearly observations ranging from 1998 to 2010. The analysis shows that the supply of non-stop flights provided by Full-Service Carriers (FSCs) has a positive impact on the exports of Italian regions, whilst no significant evidence of this is found for Low-Cost Carriers. After taking the endogeneity of flight frequency into account, the estimates indicate that the elasticity of exports to FSC non-stop flights is about 10 percent.
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