Empirical Research

Abstract

The purpose of this chapter is to check whether or not the model previously outlined is consistent with empirical observations. Section 7.1 looks briefly at the correlation between exports of international aviation services and the number of passengers flown by the flag carrier. The subsequent section tests the working hypothesis of the model concerning factors important in explaning the number of revenue passengers carried. The unreliability and scarcity of data on services permeats air transport as well. Perhaps the problems are less profound than in other service sectors, due to the data collection of ICAO and IATA. Nevertheless, the study of trade in international aviation services is not facilitated by readily available and reliable data. The creation of a worthwhile data set has presented innumerable problems. The lack of data tailored to the needs of the following pages requires the use of proxies and necessitated loading of data on a computer by hand. Although much more work on this level inevitably must be done to further the understanding of trade in services, it is hoped that duplication may be avoided. Therefore, within each part of this chapter data sources and calculations of each variable are carefully identified and analyzed. As with other areas of trade in services analysis, the data are inexact proxies for the desired variables. This fact will affect the results and implications of the test. The sample includes all countries containing a single flag carrier which reported data for exports and traffic stage in 1985.¹