The Economics of Direct Flights

Edwin Fujii, Eric Im and James Mak ()
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James Mak: Department of Economics, University of Hawaii at Manoa

No 198919, Working Papers from University of Hawaii at Manoa, Department of Economics

Abstract: Many tourist industry officials often lobby their local governments to invest heavily airport infrastructure (e.g. longer runways and larger terminals) in order to accommodate direct flights. We evaluate the impact of the recent initiation of direct flights from the U.S. west coast to Hawaii's neighbor islands, bypassing the previous hub, Honolulu, using interrupted time series analysis. We find a significant, though modest, increase in neighbor island travel. Direct flights may not always generate enough additional travel demand to warrant those investments.

Date: 1989
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