MACROECONOMIC DETERMINANTS OF DEMAND FOR AIR PASSENGER TRANSPORT AMONG SELECTED AIRLINES
DOI:
https://doi.org/10.47941/jbsm.173Keywords:
Price, Non-Price, Determinants, Demand, Passenger, Transport, Selected, AirlinesAbstract
Purpose: The purpose of this paper was to investigate the price and non-price determinants of demand for air passenger transport among selected airlines.
Methodology: The study target population was airlines across the World. The study used a sample of 10 airlines across the World. The airlines included; British Airways, Ethiopian Airways, Emirates , Qatar Airways, Turkish Airlines, South Africa Airlines, China Southern Airlines, Kenya Airways, Egypt air and Air France. Secondary data of the selected airlines was collected from the International Air Transport Association (IATA) for the period from 2005 to 2014. The data collected was analyzed using STATA software to generate descriptive, trends and inferential statistics which were used to derive conclusions and generalizations regarding the population. The panel data regression model was used to determine the relationship between study variables.
Results: Based on the findings, the study concluded that both domestic and global interest rates have a negative and significant effect on demand for air passenger transport. Further, the study concluded that GDP growth (domestic), GDP growth (global) and GDP per capita have a positive and significant effect on demand for air passenger transport.
Recommendations: Based on the findings, the study recommended that, at a macro level, airlines should consider adjusting their travel prices using the directional movements of the above mentioned variables as a guideline. Based on the findings, the study recommended that governments should use the study of demand drivers to forecast their capital investment plan for the improvement of the air transportation systems in their respective countries and design policies that require use of the demand drivers observed in this study for planning of aviation infrastructure expansion.
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