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Airports, market access and local economic performance: Evidence from China

Author

Listed:
  • Gibbons, Stephen
  • Wu, Wenjie
Abstract
In this paper we study the effect of airports on local economic performance that arises from better access to domestic markets, using China’s recent rapid air network expansion. We estimate the effects of the implied changes in access to population on measures of economic performance using a panel of counties built from administrative records and micro data on industrial firms. To mitigate endogeneity concerns we focus on a subsample of ‘incidentally’ affected counties, whose location midway between existing and new airports implies they not were explicitly targeted for development nor directly affected by airport operations. We also decompose market access into land-side and air-side components. Our key finding is that improved population access due to land-side distance reductions to airports increased industrial output and GDP, with an elasticity of around 0.25. An instrumental variables strategy exploiting conversion of historical military airports to civil use yields higher elasticities.

Suggested Citation

  • Gibbons, Stephen & Wu, Wenjie, 2017. "Airports, market access and local economic performance: Evidence from China," LSE Research Online Documents on Economics 83630, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:83630
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    Cited by:

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    2. Stephen Gibbons & Stephan Heblich & Ted Pinchbeck, 2018. "The spatial impacts of a massive rail disinvestment program: the Beeching axe," CEP Discussion Papers dp1563, Centre for Economic Performance, LSE.
    3. Bottasso, Anna & Conti, Maurizio & Vannoni, Davide, 2019. "Scale and (quasi) scope economies in airport technology. An application to UK airports," Transportation Research Part A: Policy and Practice, Elsevier, vol. 125(C), pages 150-164.
    4. Xingjian Liu, 2020. "Assessing airport ground access by public transport in Chinese cities," Urban Studies, Urban Studies Journal Limited, vol. 57(2), pages 267-285, February.
    5. Liaoliao Duan & Dongxiao Niu & Weizeng Sun & Siqi Zheng, 2021. "Transportation infrastructure and capital mobility: evidence from China’s high-speed railways," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 67(3), pages 617-648, December.
    6. Lenaerts, Bert & Allroggen, Florian & Malina, Robert, 2021. "The economic impact of aviation: A review on the role of market access," Journal of Air Transport Management, Elsevier, vol. 91(C).
    7. Gong, Zhenwei & Zhang, Fangni & Liu, Wei & Graham, Daniel J., 2023. "On the effects of airport capacity expansion under responsive airlines and elastic passenger demand," Transportation Research Part B: Methodological, Elsevier, vol. 170(C), pages 48-76.
    8. Suchi Kapoor Malhotra & Howard White & Nina Ashley O. Dela Cruz & Ashrita Saran & John Eyers & Denny John & Ella Beveridge & Nina Blöndal, 2021. "Studies of the effectiveness of transport sector interventions in low‐ and middle‐income countries: An evidence and gap map," Campbell Systematic Reviews, John Wiley & Sons, vol. 17(4), December.
    9. Provenzano, Sandro, 2020. "Isolated and Poor: the cost of remoteness from the capital city," LSE Research Online Documents on Economics 105688, London School of Economics and Political Science, LSE Library.
    10. Carbo, Jose M. & Graham, Daniel J., 2020. "Quantifying the impacts of air transportation on economic productivity: a quasi-experimental causal analysis," Economics of Transportation, Elsevier, vol. 24(C).
    11. Conti, Maurizio & Ferrara, Antonella Rita & Ferraresi, Massimiliano, 2019. "Did the EU Airport Charges Directive lead to lower aeronautical charges? Empirical evidence from a diff-in-diff research design," Economics of Transportation, Elsevier, vol. 17(C), pages 24-39.
    12. Bottasso, Anna & Conti, Maurizio & Costacurta de Sa Porto, Paulo & Ferrari, Claudio & Tei, Alessio, 2021. "Roads to growth: The Brazilian way," Research in Transportation Economics, Elsevier, vol. 90(C).

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    More about this item

    Keywords

    airports; infrastructure; productivity; china;
    All these keywords.

    JEL classification:

    • R14 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Land Use Patterns
    • J01 - Labor and Demographic Economics - - General - - - Labor Economics: General

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