Air transportation demand forecasts in emerging market economies: a case study of the Kyrgyz Republic in the former Soviet Union

Richard C. Cline, Terry A. Ruhl, Geoffrey D. Gosling and David W. Gillen

Journal of Air Transport Management, 1998, vol. 4, issue 1, 11-23

Abstract: This paper describes an approach to forecasting air transportation demand that was performed as part of a feasibility study for the rehabilitation of Bishkek-Manas International Airport located in Bishkek, the capital of the Kyrgyz Republic. Since its separation from the former Soviet Union in August 1991, the Kyrgyz Republic has begun a transition from a planned economy to a market-based economy. To promote economic development and to become competitive in a worldwide market economy, the government of the Kyrgyz Republic has initiated a program to modernize its aviation system. The forecasting methodology differs from typical forecasting approaches because the historical information on air traffic that occurred under the planned economy is no longer relevant to future air transportation demand in a market-based economy. Because the development of Kyrgyz economy and the role of air transportation in this development will depend on future decisions and policy choices, an estimate of the likely range of traffic levels was needed to estimate both the extent of the facilities that could be required, and the ability to pay for them. Thus, the forecasts prepared for the feasibility study were based on several alternative economic development scenarios that reflected different strategies that might be issued to foster economic growth. These included tourism, resource extraction, and development of an airline hub or foreign trade zone. Using data from 30 countries at varying stages of economic development, models were developed that related air passenger and air freight traffic to aggregate domestic product. These models then were applied to alternative scenarios of economic growth rates for the Kyrgyz Republic to develop a range of forecast traffic levels. The impact of different development strategies on growth of gross domestic product was estimated, and compared to the growth assumptions in the alternative scenarios.

Keywords: Aviation demand; Forecasting; Emerging market economies (search for similar items in EconPapers)
Date: 1998
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Citations: View citations in EconPapers (9)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jaitra:v:4:y:1998:i:1:p:11-23

DOI: 10.1016/S0969-6997(97)00012-4

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