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Open skies over the Middle East

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  • Cristea, Anca
  • Hillberry, Russell
  • Mattoo, Aaditya

Abstract

The dynamism of air traffic markets in the Middle East obscures the persistence of restrictions on international competition. But how important are such restrictions for passenger traffic? This paper uses detailed data on worldwide passenger aviation to estimate the effect of air transport policy on international air traffic. The policy variable is a quantitative measure of the commitments under international agreements. The paper analyzes, for the first time, not only bilateral agreements, but also plurilateral agreements such as the one between Arab states. The analysis finds that more liberal policy is associated with greater passenger traffic between countries. Higher traffic levels appear to be driven primarily by larger numbers of city pairs being served, rather than by more passengers traveling along given routes. To demonstrate the quantitative implication of the estimates, two liberalization scenarios in the Middle East are evaluated. Deepening the plurilateral agreement among Arab states would lead to a 30 percent increase in intraregional passenger traffic. Widening the agreement to include Turkey would generate significantly larger gains because current policy vis-à-vis Turkey is much more restrictive.

Suggested Citation

  • Cristea, Anca & Hillberry, Russell & Mattoo, Aaditya, 2014. "Open skies over the Middle East," Policy Research Working Paper Series 6937, The World Bank.
  • Handle: RePEc:wbk:wbrwps:6937
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    References listed on IDEAS

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    Cited by:

    1. Demet Yilmazkuday & Hakan Yilmazkuday, 2017. "The role of direct flights in trade costs," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 153(2), pages 249-270, May.
    2. repec:ris:jspord:0951 is not listed on IDEAS
    3. Megerska Abate & Panayotis Christidis, 2017. "Economic Effects of the EU External Aviation Policy," JRC Working Papers JRC105822, Joint Research Centre (Seville site).
    4. repec:elg:eechap:17028_14 is not listed on IDEAS
    5. repec:eee:transa:v:107:y:2018:i:c:p:187-202 is not listed on IDEAS
    6. Jerónimo Carballo & Georg Schaur & Christian Volpe Martincus, 2017. "Transportation and Trade Interactions: A Trade Facilitation Perspective," IDB Publications (Working Papers) 97957, Inter-American Development Bank.
    7. Tomová, Anna, 2015. "The need for new directions in airspace economics: Seventy years after Chicago," Journal of Air Transport Management, Elsevier, vol. 44, pages 1-7.
    8. Bernardo, Valeria & Fageda, Xavier, 2017. "The effects of the Morocco-European Union open skies agreement: A difference-in-differences analysis," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 98(C), pages 24-41.
    9. Abate, Megersa, 2016. "Economic effects of air transport market liberalization in Africa," Transportation Research Part A: Policy and Practice, Elsevier, vol. 92(C), pages 326-337.
    10. Jerónimo Carballo & Georg Schaur & Christian Volpe Martincus, 2018. "Transportation and trade interactions: a trade facilitation perspective," Chapters,in: Handbook of International Trade and Transportation, chapter 14, pages 422-450 Edward Elgar Publishing.
    11. Abate, Megersa, 2014. "Economic effects of air transport market liberalization in Africa," Working papers in Transport Economics 2014:23, CTS - Centre for Transport Studies Stockholm (KTH and VTI).

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    Keywords

    Transport Economics Policy&Planning; Airports and Air Services; Roads&Highways; Public Sector Corruption&Anticorruption Measures; Air Quality&Clean Air;

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