Quantification of the air transport industry socio-economic impact on regions heavily depended on tourism

Abstract

Abstract Air transport development is key driver for growth in national and international scale. The key objective of this paper is to quantify the socio-economic impact of air transports on regions heavily depended on tourism. By a top-down analysis, the trends and characteristics of tourism and aviation are highlighted, providing the linkage between these two industries. According to a systemic approach the concept, the methodology and the results are analysed, providing the framework for similar applications. The numerical application is Greece, which is a very attractive tourist destination on one hand; and suffers from economic stress on the other. Conventional wisdom is to provide an easy to handle tool appropriate for relevant applications; and highlight key messages to decision makers and stakeholders. In this paper a socio-economic impact assessment modelling framework is constructed. The methodology based on income-expenditures concept used to quantify the direct-indirect-induced effects of air transports and the spillover effects of air transports to tourism industry and, finally, to the local or national economy. The spillover economic effects involves identifying the key supply chain linkages in the transportation sector and the quantification of air transport in enabling tourism activity and inducing spending by visitors in the domestic economy, referred as catalytic impact. Finally, the analysis provide results regarding the impact of aviation on key economic indicators and business sectors at a regional or national scale. The modelling approach based on the Input - Output (I-O) matrix algebra concept providing results of the air transports overall effects to an economy heavily dependent on tourism. The paper is structuring to provide an essential tool for planners, economists, analysts and researchers regarding the business relationship of air transport and tourism industry on one hand; and aviation and regional development on the other.