|Title:||Modeling the Potential for Aviation Liberalization in Central Asia - Market analysis and implications for the Belt and Road initiative|
Czerny, Achim I.
|Keywords:||air transport; liberalization; Central Asia; Belt and Road|
|Abstract:||This study analyzes aviation markets in the five land-locked countries in Central Asia. Panel data spanning from 2007 to 2015 are used to estimate airline entry patterns in origin-destination markets. Econometric estimates for domestic and international markets are subsequently benchmarked, and route groups are paired by alternative matching algorithms so that counter-factual analysis can be conducted. Our investigation suggests that although the Central Asia–China markets are characterized by poor connectivity and high airfares, great benefits could be achieved if more liberal aviation policies such as those proposed by the Belt and Road initiative were introduced. In particular, our counterfactual analysis suggests that if the Central Asia–China markets were regulated and operated in a similar way to the routes between Central Asia and other states, the probability of having aviation services between cities in China and Central Asia would increase by 27%, even by conservative estimates. The number of Chinese destinations could increase by more than 150%. Our study finds strong negative effects of the restrictive regulations on the international aviation markets, and calls for further liberalizations between Central Asia and the region’s major trade partners.|
|Type of Work:||Working Paper|
|Appears in Collections:||ITLS Working Papers 2018|
|ITLS-WP-18-09.pdf||1.4 MB||Adobe PDF|
Items in Sydney eScholarship Repository are protected by copyright, with all rights reserved, unless otherwise indicated.