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The Network of US Airports and its Effects on Employment

Nicholas Sheard

Centre of Policy Studies/IMPACT Centre Working Papers from Victoria University, Centre of Policy Studies/IMPACT Centre

Abstract: This paper estimates the effects of airport infrastructure on employment and the distribution of the labor force in US metropolitan areas. The analysis is based on models for the air network and for its effects on employment, which are estimated using US data. Air traffic is found to have a positive effect on the population of the local area, with an elasticity of 0.010, so airport improvements induce a reallocation of workers between regions. Air traffic is also found to have a positive effect on employment in the local area with an elasticity of 0.036 and a weakly positive effect on the employment rate in other places within 400 miles. Simulations suggest that for each job created in the local area by an airport expansion, two and a half jobs are created elsewhere in the US due to the changes in the air network and the distribution of employment. Expanding the average airport adds one job in the US for roughly each $78,000 invested. The results further suggest that the US air network is less centralized than would be optimal.

Keywords: Airport; Network; Transportation infrastructure; Urban growth (search for similar items in EconPapers)
JEL-codes: H54 L93 R11 R42 (search for similar items in EconPapers)
Date: 2020-12
New Economics Papers: this item is included in nep-geo, nep-tre and nep-ure
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Persistent link: https://EconPapers.repec.org/RePEc:cop:wpaper:g-313

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