Seminario titulado: "The impact of direct flight interruptions on tourism demand: Are airline subsidies justified?". El seminario será el VIERNES 11 de octubre a las 12:30hs, en la sala Dr. Ernest LLuch (Dpto. de Economía)
Abstract: How do interruptions in direct flight connections affect tourist arrivals? Many governments in peripherical destinations subsidize private airlines to maintain a minimum frequency of flights to connect with major source markets. We exploit the timing of the expiration of concessionary contracts between the airport of Asturias (Northern Spain) and private airlines that directly connected it with London and Paris to infer the sensitivity of international tourism demand to the availability of direct flight routes. Using a difference-in-difference research design, taking arrivals to the Basque Country as the control group, we show that the interruption of direct air services caused an average drop in airplane tourist arrivals of about 34.3 per cent. Our findings offer relevant policy implications for the public subsidization of international direct air routes in peripherical regions.
