|Piermartini, Roberta and Rousova, Linda (2009): Free Sky and Clouds of Restrictions. Discussion Papers in Economics 2009-11|
An increasing percentage of trade occurs via air. However, air services are excluded from the WTO Agreement and, as a result, the aviation market is regulated by a plethora of Air Services Agreements. In this paper, we investigate the extent of discrimination -in terms of access to international air services- generated by this system. In particular, using recently available information on Air Services Agreements for 184 countries, we estimate the impact of international air services liberalization on air passenger flows. We find that increasing the degree of liberalization has a positive and significant effect. For instance, the higher degree of air services liberalization among countries of the European Economic Area (EEA) is estimated to account for approximately 30 per cent higher intra-EEA passenger traffic compared with countries that signed Open Skies-type agreements. Our results are robust to the use of several measures of liberalization as well as alternative estimation techniques that address potential problems of endogeneity, heteroscedasticity and data inaccuracy.
|Item Type:||Paper (Discussion Paper)|
|Keywords:||Air Services Agreements; Air services liberalization; Air passenger traffic; Regulatory quality.|
Economics > Discussion Papers in Economics
Economics > Discussion Papers in Economics > International Trade
|Subjects:||300 Social sciences > 300 Social sciences, sociology and anthropology|
300 Social sciences > 330 Economics
|JEL Classification:||F15, L93, R48|
|Deposited On:||15. Jul 2009 07:02|
|Last Modified:||27. Nov 2013 14:55|
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