Income distribution and demand for air transport: an econometric model specification for the Brazilian domestic market

Authors

  • Jessica Aline Franco Frazão Instituto Tecnológico de Aeronáutica, São Paulo – Brasil
  • Alessandro V. M. Oliveira Instituto Tecnológico de Aeronáutica, São Paulo – Brasil

DOI:

https://doi.org/10.14295/transportes.v28i5.1662

Keywords:

Air transportation, Econometrics, Demand model, Income distribution.

Abstract

This paper aims to investigate the relationship between income inequality and demand for air transportation in Brazil. The greater popularization of the airline industry observed in recent decades in the country allows us to raise the hypothesis that the reduction of income inequality would have induced a more price-sensitive latent demand, resulting in an increase in the number of passengers carried in commercial aviation. We estimate an air travel demand model applied to the main city-pairs of the domestic scheduled aviation, by employing the Generalized Moments Method estimator in which we control for the endogeneity of the average yield and its interaction with the Gini Index complement. The results suggest that the reduction of income inequality has intensified the price elasticity of demand in the country.

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Published

2020-08-31

How to Cite

Frazão, J. A. F., & Oliveira, A. V. M. (2020). Income distribution and demand for air transport: an econometric model specification for the Brazilian domestic market. TRANSPORTES, 28(3), 1–13. https://doi.org/10.14295/transportes.v28i5.1662

Issue

Vol. 28 No. 3 (2020)

Section

Artigos

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