Airlines In Countries Research Articles

Financial performance and safety in the aviation industry

PurposeThis paper investigates whether financial factors, which are presumed to influence an airline's maintenance, purchasing, and training policies, are associated with the air carrier's safety performance.Design/methodology/approachIn this paper, we employ a series of univariate and multivariate tests (OLS and Poisson regressions) to examine whether an airline's financial well-being as well as a country's legal and economic environment affect the airline's accident rate. Our study is the first to employ an international sample that covers 110 airlines in 26 countries over the period 1990–2009.FindingsWe document an inverse relationship between the profitability of air carriers and their accident propensity. Other financial variables such as liquidity, asset utilization, and financial leverage also appear to affect an airline's safety record, although these findings do not reach significance in all models. Flight equipment maintenance and overhaul expenditures are negatively related to accident rates. In addition, our results show that country-level variables related to the legal and economic environment have a significant effect on airline safety. Specifically, airlines in countries with strong law enforcement, more stringent regulatory systems, and better economic performance have superior safety performance. A series of robustness tests confirms our results.Originality/valueThe unique contributions of the study are (1) that it is the first to explore the drivers of safety performance in a cross-country context and (2) that it introduces a novel index of capacity when computing accident rates. By using data from 110 airlines in 26 countries, the study does not only provide insights into the firm-level but also the country-level determinants of an airline’s safety performance. The results of this research should be of interest both to academics and to regulators who develop, oversee, and implement policies targeted at improving aviation safety on a national and supranational level.

The economic approach to subsidies for foreign airlines

Many air carriers have challenged each other's financing arrangements, each asserting that the other benefits from substantial subsidies. We argue that the ‘subsidy’ classification is a distraction. Firstly, subsidies are quite difficult to define. Secondly, subsidies are little different in their economic effects to many other policy actions, and should be evaluated by policymakers similarly to these other measures. An economic approach would be to assess whether, in overall cost-benefit terms, a country is harmed by subsidies received by another country's airlines. Even if home airlines lose out, home passengers will gain, and the balance will often be positive. The paper outlines the circumstances under which a country would gain or lose from a subsidy to a foreign airline.

Discriminatory Product Differentiation: The Case of Israel's Omission from Airline Route Maps

While product differentiation is generally benign, it can be employed to discriminate against customer groups, either to enhance profitability by appealing to discriminatory customers or in unprofitable ways that indulge owners’ tastes for discrimination. We explore discriminatory product differentiation by international airlines through their depictions of Israel on online route maps and whether their online inflight menus include kosher meal options. We first show that several airlines omit Israel from their online route maps. Three of these airlines are members of major international airline alliances. With data on over 100 airlines, we then document that online route map “denial” of Israel’s existence is more likely for airlines with likely customers from countries exhibiting greater anti-Semitism. Likely owner tastes also matter: denial is more likely for state-owned airlines in countries that do not recognize Israel. Availability of kosher meal options follows similar patterns, suggesting anti-Semitic rather than anti-Zionist motivations. Neither online route map treatment nor ownership by states not recognizing Israel affects the likelihood of alliance membership with alliance leaders having few airline alternatives to choose from in the Middle East. (180 words)

Transnational Airlines in Latin America Facing the Fear of Nationality

Latin America has been the recent scenery of cross-border mergers and acquisitions of airlines in countries in which their domestic law allows important foreign investment in air carriers. However, the still present architecture of bilateral exchange of traffic rights between countries, encouraged by the 1944 Chicago Convention, is a serious threat for the development of these transnational airlines, operating through a complex network of corporations incorporated in different countries. Typically, this bilateral architecture includes 'ownership and effective control' clauses that require an airline designated by a country party to a bilateral air services agreement (ASA) to be majority owned and effectively controlled by its nationals. Such nationality clauses were founded, back in the 1930s for security (including military) and economic reasons. Recently, some Latin American countries are liberalizing nationality requirements for designated airlines under bilateral ASAs in conformity with their locally relaxed posture pertaining to foreign investment in air carriers. Regional initiatives have also been taking place, slowly waiving the traditional restrictive attitude towards the previously mentioned nationality requirements. Hence, it is argued that airline's designation under a bilateral ASA in Latin America should be focused on criteria that are linked with the corporative structure rather than on the nationality of the final ownership of the airline. This position will be coherent with today's reality in regard to the airline industry of the region.

Transformation in Accounting Policies Impact on Earning Management of Pakistan International Airlines - PIA

Pakistan International Airlines is the national flag carrier of Pakistan and this is the only public limited airline in the country otherwise there are multiple airlines operating in Pakistan. Some nations were recognized on the basis of their country's airlines because airlines represent their countries through worldwide operations and Pakistan International Airlines is one of them which widen the impact of Pakistan allover the world. The major component in the annual report of a firm is its accounting policies and these accounting policies plays a role of skeleton in the preparation of financial statements. A change in accounting policy can impact significantly the financial reporting as well as the earning management of an organization. The accounting policies have a major impact on the financial reporting as well as the earning management of an organization and these are the policies on which the structure of financial statement depends. If the company has appropriate accounting polices according to the International Accounting Standards (IAS) and Securities and Exchange Commission (SEC) then the company's financial statements are reliable until and unless the company is honest in its financial reporting otherwise these are fraudulent. The impact of changes in accounting policies on the earning management of Pakistan International Airlines has been studied. This research paper covers the major changes in the accounting polices of PIA which had impacted considerably the earning management of Pakistan International Airlines. The changes in accounting policy which had minute effect on the earning management were ignored and only major changes in the accounting polices have been studied in this research paper. There were a lot of changes in the accounting policies of Pakistan International Airlines from year 1996 to year 2005 but as mentioned above only major changes in the accounting polices have been examined. This research paper only covers the accounting changes from year 1996 to year 2005 which impacted the earning management and financial reporting of Pakistan International Airlines.

Air Transport in the Asian–Pacific Region

SummaryAir transport in the Asian–Pacific region is growing faster than anywhere else. Asian airlines (other than Japanese) are the lowest cost operators in the world. But like all airlines, they operate in a tightly regulated framework. Some 2000 bilateral air service agreements among 160 countries specify which airline flies on a route, what capacity it offers and how much capacity third–country airlines are allowed. The regulatory system is now coming under various pressures: from the growth of a tourist industry demanding lower fares, from increased competition with the emergence of a new generation of low–cost airlines, and from the US ‘mega carriers’ and their alliances. The airlines of the region have the opportunity to benefit from these changes in the regulatory environment. But this will require a more trade–oriented approach to aviation than some countries of the region now have.A number of guiding principles for civil aviation policy in the 1990s suggest themselvesMore liberal arrangements for the allocation of traffic rights would benefit the regional economiesSuch liberalization is possible within the current bilateral system, but faster progress would be achieved through regional negotiationsSuch regional negotiations are likely to make greater progress if conducted jointly with other trade issuesThere remains a role for GATS (General Agreement on Trade in Services) type arrangements, especially in relation to so–called ‘soft rights’, and in laying down ground rules for regional negotiations.

Cooperative Ventures In The United States

Since 1970 there has been an increased interest in alternative forms of business enterprise, different from the traditional capitalistic controlled organizations. The move has been toward the creation of a new system of work and increased participation in the workplace. There are several factors that account for the interest in worker and producer-owned enterprises. A first is the desire for worker participa? tion and for making the workplace more democratic. A second is that high levels of unemployment and the erosion in productivity have led employers and employees to seek solutions through alternative forms of business enterprise. A third is that the increase in plant closings and the transfer of operations to other regions have forced unions and communi? ties to buy back plants from the parent companies, thus preserving jobs and preventing further erosion in the community. A fourth is that the success stories of worker-owned enterprises in this country and abroad have demonstrated strong economic performance by such enter? prises. Although workplace democracy is still in its formative stages, the list of worker owned firms is expanding; examples include a number of this country's airlines, four of the nation's largest trucking firms, a quarter of the plywood producing firms, the tenth largest steelmaker, and numerous wholesale and retail outlets. There are two dominant models of cooperatives, one patterned after the Rochdale model in England, the other after the highly successful Mondragon cooperative in Spain. The beginning of Rochdale was inconspicuous. In 1844, 28 weavers (27 men and 1 woman) who lost their jobs after an unsuccessful strike in Rochdale, England established a cooperative store and a self supporting colony of united people. They

In the melting‐pot again

BRITISH Civil Aviation has been dragged into the arena of party politics and has become the handmaiden of political expediency. That is what the recently announced Government scheme for the nationalization of this country's Air Lines means; because the new organization differs in no way, but for this ideological change, from that laid down by the National Government in the White Paper issued last March.