The impact of the current economic crisis on the geography of air traffic volumes: an empirical analysis

Dobruszkes, Frédéric; Hamme, Gilles Van

doi:10.1016/j.jtrangeo.2011.07.015

Cited by 61 publications

(29 citation statements)

References 30 publications

(36 reference statements)

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“…From the mid 1990s, the industry recovered (Dempsey, 2002;Goetz, Vowles, 2009), which is reflected in positive network effects until the end of the 1990s. During the US subprime crisis starting in summer 2007 and the subsequent world financial crisis, a decrease in air travel demand caused airlines to enter another phase of substantial financial losses (Dobruszkes, van Hamme, 2011;Wittman, 2014). As a reaction to decreased demand, US carriers employed "capacity rationalization" (Wittman, 2014) Turning to the connectivity distribution among North American airports, researchers have found the build-up of US hub-and-spoke networks to enhance core-periphery patterns…”

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confidence: 99%

“…Fueled by increasing liberalization of air transportation in Asian countries (Forsyth et al, 2006) and the emergence of Asian Low Cost Carriers (Hooper, 2005;Lawton, Solomko, 2005), network effects recovered, and, with the exception of a one-year slowdown in growth during the world financial crises in 2009, high growth rates prevailed until 2012 ( Fig. 12; Dobruszkes, van Hamme, 2011).…”

Section: Asiamentioning

confidence: 99%

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How air transport connects the world – A new metric of air connectivity and its evolution between 1990 and 2012

Allroggen

Wittman

Malina

2015

Transportation Research Part E: Logistics and Transportation Re

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SUMMARY ObjectiveScheduled air transport services connect airports throughout the world and thereby enable interaction on a global scale. By doing so, they spur globalization (Hummels, 2007) as well as social and economic development (Lakshmanan, 2011). In order to facilitate integration of regions into global value chains, planners, scholars and policymakers therefore need to understand as to how scheduled air transport services link a region to other markets. For this purpose, connectivity metrics have been developed, which measure the degree of connections between airports (Burghouwt, Redondi, 2013). In particular, the 'connection quality-weighting' approach (Veldhuis, 1997;Burghouwt, de Wit, 2005) has been used to compute the aggregate quality of all available connections at an airport with regard to their properties in quickly bridging distances. However, such a metric has neither been calibrated on the basis of observed passenger behavior nor been computed for the world's airports across a multi-decade time series. This paper sets out to develop the first such metric and to discuss global airline network development between 1990 and 2012 from a connectivity perspective. How Air Transport Connects the World 4 MethodologyThe Global Connectivity Index (GCI) for each airport is computed by summing the connectionquality of each available flight connection weighted by the interaction potential, to which the connection provides access. This requires three levels of analysis. First, on the link-identification level, we identify from OAG flight schedules all scheduled nonstop and onestop connections, which are available to passengers at each airport. Second, on the link-quality level, we compute each connection's frequency and relative connectivity value as compared to (hypothetical) nonstop flights. The relative connectivity value is derived from flight duration and layover time and calibrated through observed routing data for US passengers. Third, on the destination-quality level, we model the interaction potential, to which each worldwide airport provides access. For this purpose, we use gridded wealth-adjusted population data and a distance-decay function. Transaction-specific idiosyncrasies such as tastes or fares, which vary among potential passengers and impact on each passenger's itinerary choice, are not considered since they cannot be aggregated to the route level, yet. Results By computing yearly GCITo date, no analysis exists which evaluates 'quality-weighted' connectivity and/or centrality at the world's airports with the help of an empirically calibrated model. Such a model is developed in this paper. We compute these metrics to analyze worldwide connectivity and centrality trends The remainder of this paper proceeds as follows: In Section 2, the building blocks of 'connection quality-weighted' connectivity and centrality are outlined. Section 3 develops the connectivity and the centrality metrics. Global and world-region trends in connectivity and centrality between 1990 and 2012 are analyzed in Sect...

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confidence: 99%

Section: Asiamentioning

confidence: 99%

How air transport connects the world – A new metric of air connectivity and its evolution between 1990 and 2012

Allroggen

Wittman

Malina

2015

Transportation Research Part E: Logistics and Transportation Re

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“…American Airlines' recent filing for Chapter 11 bankruptcy implies that the largest full-service carriers (American, Continental, Delta, Northwest, United and US Airways) have recently gone through a period of major restructuring. Part of the recent financial woes can of course be attributed to the on-going financial and economic crises that began in 2007, which have temporarily stifled demand (Dobruszkes and Van Hamme, 2011). Nonetheless, whatever the source of the poor financial performance of US carriers, it is clear that constantly (re)examining pricing strategies will be of key importance in order to reap the potential benefit of an expanding market.…”

Section: Introductionmentioning

confidence: 99%

The impact of hub hierarchy and market competition on airfare pricing in US hub-to-hub markets

Zhang

Derudder

Witlox

2013

Journal of Air Transport Management

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This paper explores factors influencing the pricing behaviour of full-service carriers in hub-to-hub markets, which to date have rarely been the exclusive focus of research. Drawing on a 2009 dataset containing route and airfare information, we estimate a pricing model for hub-to-hub markets in the United States. Our econometric analysis suggests that an airport's position in carriers' hub hierarchies, competition from low-cost carriers, and other market structure variables influence average airfares.

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“…This can be explained by the fact that the impact of the major LCC airports on changes of European airport network is so dramatic that the effect of some airports playing bridging roles on network dynamics can be neglected. In addition, the major LCC airports were affected less than the hub airports given the recent economic crisis (Dobruszkes and Van Hamme, 2011), which may make the latter taking more conservative strategy to expand their networks.…”

Section: Parameter Interpretationmentioning

confidence: 99%

“…The negative effects of those two dyadic covariates may largely due to the recent economic crisis and they only show marginally significant effects (i.e., the p-values are 0.04 and 0.09, respectively). Dobruszkes and Van Hamme (2011) found that most airports in Europe faced a stagnation or decline in air supply in terms of number of seats during the recent economic crisis corresponding to the decrease of demand. Opening a new route seems to be risky and difficult for airlines to adapt to the economic decline due to long negotiation time and high costs.…”

Section: Parameter Interpretationmentioning

confidence: 99%

Dynamics in the European Air Transport Network, 2003–9: An Explanatory Framework Drawing on Stochastic Actor-Based Modeling

Zhang¹,

Derudder²,

Witlox³

2015

Netw Spat Econ

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In this paper, we outline and test an explanatory framework drawing on stochastic actor-based modeling to understand changes in the outline of European air transport networks between 2003 and 2009. Stochastic actor-based models show their capabilities to estimate and test the effect of exogenous and endogenous drivers on network changes in this application to the air transport network. Our results reveal that endogenous structural effects, such as transitivity triads, indirect relations and betweenness effects impact the development of the European air transport network in the period under investigation. In addition, exogenous nodal and dyadic covariates also play a role, with above all the enlargement of the European Common Aviation Area having benefitted its new members to open more air routes between them. The emergence of major low-cost airline-focused airports also significantly contributed to these changes. We conclude by outlining some avenues for further research.

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The impact of the current economic crisis on the geography of air traffic volumes: an empirical analysis

Cited by 61 publications

References 30 publications

How air transport connects the world – A new metric of air connectivity and its evolution between 1990 and 2012

How air transport connects the world – A new metric of air connectivity and its evolution between 1990 and 2012

The impact of hub hierarchy and market competition on airfare pricing in US hub-to-hub markets

Dynamics in the European Air Transport Network, 2003–9: An Explanatory Framework Drawing on Stochastic Actor-Based Modeling

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