Determinants behaviour analysis of demand for passengers to the Portuguese air travel leisure market: Application with Partial Least Squares Regression (PLS)

Abstract

This paper aims to determine and analyse the behaviour of the demand for passengers' leisure air travel in the Portuguese market (between Lisbon and Oporto and the Azores and Madeira), between 2010 and 2014, using an application of partial least squares regression (PLSR). The PLS regression analysis used in the essay was developed by Wold (1985) and in accordance with Tenenhaus et al.'s (2005) study. In the first section we present a contextualisation of the PLSR. In a second section we present the data and the model. In a third section we present the discussion of results. Finally, we present the final considerations. The results of our empirical analysis suggest that the demand for air transport of passengers between Portugal and the Azores and Madeira is more affected by the destination attraction factors than by aviation industry factors. The results were promising and provide important information to improve business decision making.