Air Transport and Regional Development Case Studies

Anne Graham, Nicole Adler, Hans-Martin Niemeier, Ofelia Betancor, António Pais Antunes, Volodymyr Bilotkach, Enrique J. Calderón, Gianmaria Martini, Anne Graham, Nicole Adler, Hans-Martin Niemeier, Ofelia Betancor, António Pais Antunes, Volodymyr Bilotkach, Enrique J. Calderón, Gianmaria Martini

• Publisher: Routledge
• Year: 2020
• Print ISBN: 9780367551209
• eBook ISBN: 9781000326543
• Edition: 1
• Topic: Technology & Engineering
• Subtopic: Business General
• Index: Technology & Engineering

This book is one of three inter-connected books related to a four-year European Cooperation in Science and Technology (COST) Action established in 2015. The Action, called Air Transport and Regional Development (ATARD), aimed to promote a better understanding of how the air transport related problems of core regions and remote regions should be addressed in order to enhance both economic competitiveness and social cohesion in Europe.

This book focuses on case studies in Europe related to air transport and regional development. It is divided into four geographical regions after a general chapter that compares regional air transport connectivity between remote and central areas in Europe. The first region is Northern and Western Northern Europe (case studies related specifically to Norway, Finland, the United Kingdom, and Ireland); the second is Central and Eastern Europe, (Bulgaria, Bosnia and Herzegovina, and Poland); the third is Central Western Europe (Belgium and Switzerland); and finally, the fourth is Southern Europe (Portugal, Spain, and Italy). There is no other single source publication that currently covers this topic area in such a comprehensive manner by considering so many countries.

The book aims at becoming a major reference on the topic, drawing from experienced researchers in the field, covering the diverse experience and knowledge of the members of the COST Action. The book will appeal to academics, practitioners, and policymakers who have a particular interest in acquiring detailed comparative knowledge and understanding of air transport and regional development in many different European countries. Together with the other two books ( Air Transport and Regional Development Methodologies and Air Transport and Regional Development Policies ), it fills a much-needed gap in the literature.

1 Introduction

Anne Graham, Nicole Adler, Hans-Martin Niemeier, Ofelia Betancor, António Pais Antunes, Volodymyr Bilotkach, Enrique J. Calderón and Gianmaria Martini

The air transport sector is a major contributor to the globalisation of the economy. Its growth has been accompanied and, to a certain extent, caused by liberalisation. The growth in traffic levels has led to congestion, at both major airports and in the airspace, and to a lack of services on thin routes, thus affecting both core and remote regions.

A four-year European Cooperation in Science and Technology (COST) Action was established in 2015, and this book is a direct product of this. The book was completed before the coronavirus pandemic in 2020, but the issues discussed remain very relevant. The Action, called Air Transport and Regional Development (ATARD), aimed to promote a better understanding of how the air transport-related problems of core regions and remote regions should be addressed in order to enhance both economic competitiveness and social cohesion in Europe. It had members with a wide variety of professions and backgrounds from 33 countries and involved conferences/workshops in various locations, PhD training schools, and short-term scientific missions of researchers to other academic institutions. The many countries that participated in different activities is a testament to the great interest that aviation research and regional development engenders among academics and practitioners.

The area of the Action, namely the relationship between transport and regional development, has been widely examined in the literature from a multiplicity of perspectives. However, most research has focused on land transport modes (especially road), whereas air transport research is far from having led to a coherent body of knowledge, despite some publications over the last two decades. Only a few methods have been used to explore the relationship, with the attention being put essentially on the economic dimensions of development. Moreover, it is clear that research on this subject is much more advanced in the United States than in Europe.

This book is one of three inter-connected books related to the most important themes that were explored during the four-year COST Action. It will focus on case studies (known here as ATARD case studies) related to air transport and regional development. The other two books will focus on methodological approaches (known here as ATARD methodologies) and policy implications (known here as ATARD policies). The three books complement each other in focusing on different aspects of ATARD, but are also stand-alone publications in their own right. The books fill a much-needed gap, presenting a multi-sector (airports, airlines, air navigation services, government organisations) and geographically Europe-wide coverage of both remote and core regions to fully explore all critical issues related to the linkages between air transport and regional development.

They are aimed at becoming a major reference source on the topic, within which the main findings of the Action will be condensed. There is no other single source publication that currently covers this topic area in such a comprehensive manner. The book draws from experienced researchers in the field, covering the diverse experience and knowledge of the members of the Action from 33 countries. Many of the chapters in all three books have already been presented and debated at the ATARD conferences and workshops.

The ATARD methodologies book is divided into four distinct groups of chapters; the first discussing regional economic theory, the second presenting the theory on economic impact assessment, the third describing applied economic methods covering both econometrics and game theory, and the fourth and final group debating the use of performance estimation techniques when measuring the impact of aviation on regional development.

The ATARD policies book begins with chapters that generally discuss important policy issues related to air transport and regional development in relation to connectivity and accessibility, dependency, airport governance and regulation, and air traffic control frameworks. This is followed by a number of chapters considering government studies and state aid. The final chapters then focus on other policy implications (tourism development, airport expansion, passenger taxation, and noise control).

This book (ATARD case studies) is divided into four geographical regions after a general chapter that compares regional air transport connectivity between remote and central areas in Europe. The first region is Northern and Western Northern Europe (case studies related specifically to Norway, Finland, the United Kingdom, and Ireland); the second is Central and Eastern Europe (Bulgaria, Bosnia and Herzegovina, and Poland); the third is Central Western Europe (Belgium and Switzerland); and finally, the fourth is Southern Europe (Portugal, Spain, and Italy). A summary of the different chapters of this book is provided here. The important links with the other two ATARD books are also highlighted.

In Chapter 2, Martini, Porta, and Scotti analyse air transport regional connectivity in Europe and investigate how it has recently evolved in a period of liberalisation that has shown all its effects, by potentially increasing the number of routes in European countries. This is undertaken by building a new dataset of information on intra-European Union (EU) aviation activity at the regional level for the 2009–2018 period, using the European NUTS 2 classification to identify a region. It is thus a very valid and interesting application of connectivity theory which is explored in ATARD methodologies, and of the use of connectivity metrics which are discussed in greater detail in ATARD policies.

Chapter 3, written by Halpern, focuses on geographical peripheries by considering the case of Norway which is the first chapter covering the Northern and Western Northern European region. It discusses peripheral areas and their potential impacts including economic impacts, wider impacts on regional economic and social development, and external effects on the environment, and explains that Norway is one of Europe’s most peripheral countries and is highly dependent on air transport for the accessibility and social and economic development of its regions. Input-output analysis, which is critically assessed in ATARD methodologies, is used to support the discussion about economic impacts.

In Chapter 4, Ringbom investigates the relationship between air traffic and economic development, specifically in Finland. He uses a novel approach for this market, namely an econometric technique (as detailed in the ATARD methodologies) using non-stationary and cointegrated panel data with a vector error correction approach. This, he argues, yields more valid conclusions and yields deeper insights into the underlying long-run structure and short-term adjustment in the underlying variables covering real economic activity and passenger traffic.

In Chapter 5, Graham explores developments and challenges related to UK regional airports. Issues covered include ownership developments, traffic and financial performance, and regional connectivity. A number of government policies that are discussed here specifically within the UK context are privatisation, public services obligations (PSOs), and passenger taxation, with these being given more general consideration in ATARD policies.

Chapter 6 is the last chapter specially covering Northern and Northern Western Europe. Hiney, Efthymiou, and Morgenroth focus on the regional airport of Shannon, highlighting the challenges and opportunities faced by Irish airports. The innovative ownership structure of Shannon Airport is examined (an airport group incorporating tourism and property entities) as having implications for the relationship between airports and tourism authorities, which is an important aspect of regional development that is further discussed in ATARD policies.

Chapter 7, written by Huderek-Glapska, is an introductory chapter covering detailed research of the area of Central and Eastern Europe. It provides an overview of the relationship between economic performance and the air transport markets in the region, noting that they share a common history and traditional economic system. After discussing the social-economic characteristics of the countries and the air transport markets, strengths and weaknesses – as well as opportunities and threats – are presented, and conclusions are drawn regarding the relationship between regional development and air transport in this region.

Chapter 8, authored by Todorova and Haralampiev, is the first of three chapters considering individual countries within Central and Eastern Europe. This chapter aims to establish the first empirical evidence for determining causal relationships between regional aviation/airports and economic growth in Bulgaria by assessing the issues involved with isolating bidirectional short- and long-run causality between air transport and economic growth. It uses panel data econometric models which are examined in more general detail in ATARD methodologies.

In Chapter 9, Nurković then focuses on Bosnia and Herzegovina. This is a difficult country to analyse because of the lack of adequate data but nevertheless, critical factors influencing the development of air transport can be identified. Traffic trends demonstrate that Sarajevo airport has experienced substantial growth in passenger traffic in recent years, which has major implications for regional development of the surrounding area.

Chapter 10 is the final chapter covering Central and Eastern Europe, where Olipra focuses specifically on the spending of passengers at Wroclaw airport. In undertaking such research, the significance of leisure tourism to the region is assessed which has implications for airport and tourism policies which are discussed in general in ATARD policies. The main method of investigation is a passenger survey.

Chapter 11, written by Wittmer and Noto, is the first of two chapters studying Switzerland, focusing on the intangible effects of regional airports. After presenting a conceptional framework for the location choice of firms, a key part of the research is applying this is in practice using qualitative empirical data from in-depth interviews with experts and exponents of the Swiss aviation system. The chapter is closely linked to the discussion of wider economic benefits in ATARD methodologies.

Chapter 12 is the other chapter that covers Switzerland, authored by Noto and Kansikas. With their research, three international and two of the four main regional Swiss airports are benchmarked against a representative set of 112 European airports based on a stochastic frontier analysis with an input-oriented, multi-output distance function. Further explanation of the general methodology used is provided in ATARD methodologies.

In Chapter 13, Buyle, Kupfer, and Onghena also provide a case study from Central Western Europe, namely Belgium. This examines the four studies of the National Bank of Belgium that investigated the economic impact of air transport and the airport sector in Belgium. Input-output analysis is used (which is further critically assessed in ATARD methodologies), and in addition, the impact of noise pollution is evaluated.

Chapter 14, written by Freiria and Antunes, is one of the final three chapters that cover case studies from Southern Europe. This chapter uses econometric methods (which are discussed in greater detail in ATARD methodologies) to evaluate the impact of Oporto Airport on the development of the Norte Region of Portugal between 2000 and 2016, considering both industry and services sectors.

In Chapter 15, Vasallo, Ortuño, and Betancor focus on neighbouring Spain and estimate the socio-economic accounts for the four main interurban transport modes in Spain: road, rail, air, and maritime. The aim is to determine if each mode bears its costs, which includes infrastructure and the external costs to examine to what extent the ‘user pays’ and the ‘polluter pays’ principles are currently being applied.

Chapter 16 is the final case study from Southern Europe and the final chapter of the book. Percoco considers a very specific situation, namely airport de-hubbing at Milan, to explore the effects and whether they are consistent with the theory of spatial equilibrium. It views the de-hubbing development as a type of natural experiment to estimate the effect of air accessibility on local economies. Similar to a number of chapters in this book, it uses econometric models. More details about these and their general relevance to air transport and regional development is discussed in ATARD methodologies.

We would like to thank all the contributors to this book. We would also like the reviewers of the chapters for providing helpful comments and suggestions. We are especially indebted to Christian Bontemps, Frédéric Dobruszkes, Christos Evangelinos, Frank Fichert, Franziska Kupfer, Juan Carlos Martin Hernandez, Aisling Reynolds-Feighan, Sonia Huderek-Glapska, Juergen Mueller, Marco Percoco, Steve Ison, Tolga Ülkü, and Nicola Volta.

We wish you a pleasant read.

2 The evolution of regional air transport connectivity in Europe

A comparison between remote and core regions

Gianmaria Martini, Flavio Porta, and Davide Scotti

Introduction...

Table of contents

• Cover
• Half Title
• Title
• Copyright
• Contents
• List of figures
• List of tables
• Editors and contributors
• 1 Introduction
• 2 The evolution of regional air transport connectivity in Europe: a comparison between remote and core regions
• 3 The impacts of airports in geographical peripheries: a Norwegian case study
• 4 The relationship between air traffic and the regional development in Finland
• 5 UK regional airports: developments and challenges
• 6 Regional airport business models: Shannon Group as a case study
• 7 The air transport markets in Central and Eastern Europe
• 8 Air transport and economic growth of the regions: causality analysis in Bulgaria
• 9 The effects of air traffic on the economic development of Bosnia and Herzegovina
• 10 Expenditure of inbound passengers at Wroclaw airport and the significance for the regional economy
• 11 Intangible effects of regional airports in the aviation system: the case of Switzerland
• 12 Swiss international and regional airports: an efficiency benchmarking
• 13 A Belgian case study of the economic importance of air transport and airport activities
• 14 The impact of Oporto Airport on the development of the Norte Region of Portugal: an econometric study
• 15 Spanish Transport Accounts
• 16 The spatial economic effects of airport de-hubbing: the Milan case
• Index