Abstract
Airline industry is very important for modern society as the biggest player in the globalization process by connecting regions, promoting global trade and tourism, facilitating economic and social development. However, here is a lack of research on relationship between globalization and airline industry in Europe. It remains unclear how to measure the impact of globalization on performance of airline companies and industry. The article aims at investigation of the impact of globalization on operational and financial performance of European airlines before pandemics.The authors applied a nonexperimental quantitative research design to analyze the relationship between independent globalization variables (level of globalization in Europe, globalization opportunity, globalization threat) and dependent airlines’ operational and financial performance indicators. Research is done using secondary data from annual reports of 19 European airlines members of European Common Aviation Area (ECAA). The panel data analysis was applied for 2007–2017 with multiple regression analysis using STATA. The results show that globalization exerts a significant positive effect on operational performance. On financial performance only revenue per passenger kilometers is positively influenced by globalization. Globalization affects low-cost airlines and full-service airlines performance differently.
Highlights
Many scholars are considering the globalization as a crucial force influencing the formation of new economic order
This indicates that the increase in the level of globalization in Europe by 1 point leads to the growth of airlines’ capacity by 5.52 bln. seat-km while the expansion of the geography of flights by 1 destination leads to the increase of Available seat kilometer (ASK) by 0.19 bln. seat-km
R-square of the model is 0.471 which means that 47% of the variance in ASK is explained by globalization
Summary
Many scholars are considering the globalization as a crucial force influencing the formation of new economic order. Globalization is accompanied by the change of role of institutions, society, business, state, international organizations etc. The debate about essence of the concept of globalization and its key characteristics has intensified in economic, sociological, and political literature. This discussion did not come to a logical conclusion in the form of an explicitly defined understanding of globalization’s content and features which differ globalization from other phenomena characterizing the current trends of economy and society on a global level. It is necessary to continue analysis of globalization, its features and impacts
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