AIR TRANSPORTATION SERVICES: BOTH A TRADED COMMODITY AND A TRANSACTIONS COST IN INTERNATIONAL TRADE

Kenneth Button

Journal of International Commerce, Economics and Policy (JICEP), 2010, vol. 01, issue 01, 105-120

Abstract: Air transportation is a major facilitator of international trade in terms of the value of goods and services involved, and is important to specific industries, such as tourism, that are being developed by many lower income countries. High air transportation costs can pose a major impediment to the economic growth of countries, or to regions within them. But international air transportation is also an industry in its own right that can earn profits and foreign exchange for the parenting country. The newer international trade models treat transportation as a transactions cost, reductions of which confer in most cases, a gain to trading partners. Reducing air transportation costs, if resulting from rent seeking activities in protected markets, can, however reduce income for the air transportation-providing country and may impact on its foreign exchange earnings. This can reduce the incentive for a country to participate in Open Skies type situations where international air services are offered in a competitive market. Furthermore liberal trade in air transportation services can, in some cases lead to potentially less efficient provision of these services.

Keywords: Airlines; international trade; economic development; trade in services; F13; L93; O19 (search for similar items in EconPapers)
Date: 2010
References: View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://www.worldscientific.com/doi/abs/10.1142/S1793993310000093
Access to full text is restricted to subscribers

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wsi:jicepx:v:01:y:2010:i:01:n:s1793993310000093

Ordering information: This journal article can be ordered from

DOI: 10.1142/S1793993310000093

Access Statistics for this article

Journal of International Commerce, Economics and Policy (JICEP) is currently edited by Ramkishen S. Rajan

More articles in Journal of International Commerce, Economics and Policy (JICEP) from World Scientific Publishing Co. Pte. Ltd.
Bibliographic data for series maintained by Tai Tone Lim ().