sustainability Article Article
AnAn Empirical Flight EmpiricalStudy Studyon onthe theIndirect Indirect Impact Impact of of Flight Delay on China’s Economy Delay on China’s Economy Yuxiu Chen 1,2 , Jian Yu 2, *, Sang-Bing Tsai 2,3, * ID and Jinfu Zhu 1 Yuxiu Chen 1,2, Jian Yu 2,*, Sang-Bing Tsai 2,3,* and Jinfu Zhu 1 1 2 3
*
College of Civil Aviation, Nanjing University of Aeronautics and Astronautics, 1 College of Civil Aviation, Nanjing University of Aeronautics and Astronautics, Nanjing 211106, Jiangsu, Nanjing 211106, China;
[email protected] (Y.C.);
[email protected] (J.Z.) China;
[email protected] (Y.C.);
[email protected](J.Z.) Research Center for Environment and Sustainable Development of the China Civil Aviation, 2 Research Center for Environment and Sustainable Development of the China Civil Aviation, Civil Aviation Civil AviationofUniversity of China, Tianjin University China, Tianjin 300300, China300300, China Zhongshan Institute, University of China, China,Zhongshan 528400, 3 Zhongshan Institute, UniversityofofElectronic ElectronicScience Science and and Technology Technology of Zhongshan 528400, Guangdong, ChinaChina Correspondence:
[email protected] (S.-B.T.) * Correspondence:
[email protected](J.Y.); (J.Y.);
[email protected] [email protected] (S.-B.T.)
Received: 22 November 2017; Accepted: 2424 January Received: 22 November 2017; Accepted: January2018; 2018;Published: Published:30 30 January January 2018
Abstract: DueDue to the influence onon thethe sectors relationshipswith withthe the Abstract: to the influence sectorsand andindustries industriesthat that have have strong strong relationships air transportation industry, flight delays have a huge impact on China’s economy. In this study, the air transportation industry, flight delays have a huge impact on China’s economy. In this study, the input–output method and the Ghosh model were used to analyze the indirect economic impacts input–output method and the Ghosh model were used to analyze the indirect economic impacts of of flight demand-fareequations equationstoto flightdelays delayson onChina’s China’seconomy. economy. We Wealso alsoconstructed constructed simultaneous simultaneous demand-fare estimate thethe direct output of of thethe airair industry The final finalresults results estimate direct output industryasasa aresult resultofofflight flightdelay delay control. control. The showed that the total indirect impact of flight delays on China was Ұ 350.71 billion in 2013, stressing showed that the total indirect impact of flight delays on China was 350.71 billion in 2013, stressing importance of controlling flight delays.Since Sincedelay delaycontrol control not not only only provides provides direct the the importance of controlling flight delays. directbenefits benefitstoto passengers carriers, also indirectlycontributes contributestotoregional regional economies, economies, the passengers andand carriers, butbut also indirectly the efforts effortsbenefit benefitthe the entire Chinese society. The great investment in flight delay governance should be shared among entire Chinese society. The great investment in flight delay governance should be shared among various producing sectors. various producing sectors. Keywords: flight delay; input–output method;sustainability; sustainability;indirect indirect impact; impact; China China Keywords: flight delay; input–output method;
1. Introduction 1. Introduction Since the late 2000s, flight delay has become an increasingly serious problem and has been Since the late 2000s, flight delay has become an increasingly serious problem and has been spreading in China. Flight on-time performance decreased to 68.33% in 2015 from 81.48% in 2006, spreading in China. Flight on-time performance decreased to 68.33% in 2015 from 81.48% in 2006, according to the Civil Aviation Administration of China (CAAC) reports [1]. FlightStats’s June 2015 according to the Civil Aviation Administration of China (CAAC) reports [1]. FlightStats’s June 2015 report also ranked China Eastern Airlines and Air China as the last two carriers out of 50 main report also ranked ChinainEastern andperformance Air China as[2]. theThe last resulting two carriers out of 50 main international airlines terms Airlines of on-time inconvenience has international airlines in terms of on-time performance [2]. The resulting successfully successfully drawn the attention of research institutes, mass media,inconvenience and consensushas and relevant drawn the attention of research institutes, mass media, anddelays consensus and government government departments, particularly after extensive flight because of relevant adverse weather that departments, particularly after extensive flight delays because of adverse weather that has occurred has occurred more often in China in recent years. more often in China recent years. Flight delaysin not only disturb airline and airport operation, resulting in considerable Flight delaystonot only disturb andimpact airport resulting in of considerable inconveniences passengers, but alsoairline negatively the operation, regional economy because the strong interactive relationship between airnegatively transport impact and thethe local economy. Flightbecause delays of lead the inconveniences to passengers, but also regional economy thetostrong increaserelationship in the purchase cost of airports, and other institutions in delays the air lead transport interactive between airairlines, transport and the local economy. Flight to theindustry increase by other producing Flight delays and also inflate the operatingincost some industries because in the purchase cost ofsectors. airlines, airports, other institutions theofair transport industry by the procurement and distribution of the products of these industries heavily depend on air transport. other producing sectors. Flight delays also inflate the operating cost of some industries because For instance, business passenger increasesofadministrative costs, leading to an on increase in the the procurement and distribution ofdelay the products these industries heavily depend air transport. product’s price. This ultimately causes the transaction of related industries to falter. Furthermore, For instance, business passenger delay increases administrative costs, leading to an increase in the flight delays thecauses demands manufacturers from other associated industries, such as product’s price. may Thisconstrain ultimately theoftransaction of related industries to falter. Furthermore, tourist services. Consequently, the consumption and requirement of food, accommodation services, flight delays may constrain the demands of manufacturers from other associated industries, such as retail sales, ground transportation, entertainment, and car rental services will decrease [3]. Combined, tourist services. Consequently, the consumption and requirement of food, accommodation services, Sustainability 2018, 10, x; doi: FOR PEER REVIEW www.mdpi.com/journal/sustainability retail sales, ground transportation, entertainment, and car rental services will decrease [3]. Combined, Sustainability 2018, 10, 357; doi:10.3390/su10020357
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Zhongshan Institute, University of Electronic Science and Technology of China, Zhongshan 528400, Guangdong, China * Correspondence:
[email protected] (J.Y.);
[email protected] (S.-B.T.) 3
[email protected] (S.-B.T.)
018; Published: 30 January 2018
Received: 22 November 2017; Accepted: 24 January 2018; Published: 30 January 2018
d industries that have strong relationships Sustainability 2018, 10, 357 with the 2 of 13 huge impact on China’s economy. In this study, theAbstract: Due to the influence on the sectors and industries that have strong relationships w re used to analyze the indirect economic impacts ofair transportation industry, flight delays have a huge impact on China’s economy. In this stu these impacts are called the indirect impact method of flightand delay the economy. The U.S. Economic nstructed simultaneous demand-fare equations toinput–output theon Ghosh model were used toJoint analyze the indirect economic imp appraised theresults indirect impact of flight delay on the U.S. economy as being equivalent as a result of flightCommittee delay control. The final flight delays on China’s economy. We also constructed simultaneoustodemand-fare equat lays on China was Ұ 70.12 350.71billion billion($9.6 in 2013, stressing billion U.S. estimate at the exchange rateoutput on 31 of December 2007) in as 2007 [4], and research the direct the air industry a result of the flight delay control. The final le e delay control notfinding only provides direct benefits that the indirect impact of flight delays on China was was Ұ 29.22 350.71 billion in 2013, st of the National Centertoshowed of Excellence fortotal Aviation Operations Research (NEXTOR) ributes to regional economies, the efforts the importance billion ($4 billion U.S.benefit at the the exchange rate on of 31controlling December flight 2007) delays. for 2007Since [5]. delay control not only provides direct ben n flight delay governance should be shared among passengers and carriers, buthuge also indirectly contributes tosevere regional economies, the efforts ben The economic impact of flight delays in China is also and sometimes causes reactions. entire and Chinese society. The great investment flight delay governance To meet customers’ growing needs simultaneously reduce the extentinof flight delay, effective should be shared various producing sectors. steps to control the delays must be taken. Eleven categories of flight delay reasons exist in Statistical sustainability; impact; China 2,*, Sang-Bing u Chen 1,2, Jianindirect Yu Method Tsai 2,3, * and[6] Jinfu Zhu 1 by CAAC. The annual statistical data of normal flights in the of Normal Flight published Keywords: flight delay; input–output method; sustainability; indirect impact; China 2,3,* and Jinfu Zhu 1 Tsai Civil Aviation Statistical Yearbookand from 2007 to 2016 show211106, that delayed ollege of Civil Aviation, Nanjing University of Aeronautics Astronautics, Nanjing Jiangsu, flights caused by bad weather, 2,3, 1 ang-Bing Tsai * and Jinfu Zhu hina;
[email protected] (Y.C.);
[email protected](J.Z.) air control and211106, inefficient airline operation accounted for 83.31% of the total delayed flights ersity of Aeronauticsinefficient and Astronautics, Nanjing Jiangsu, esearch Center forofEnvironment Development of the China Civil Aviation, Civil Aviation
[email protected](J.Z.) on averageand in Sustainable the years prior to the study. Although not all flight delays can be eliminated, such as anjing University Aeronautics and Astronautics, Nanjing 211106, Jiangsu, niversity of China, Tianjin 300300, China ustainable Development of due the China Civil Aviation, Civil Aviation (Y.C.);
[email protected](J.Z.) those to serious bad weather, the experiences from the global air transport industry indicate that 1.Technology Introduction hongshan Institute, University of Electronic Science and ofAviation China, Zhongshan 528400, ina me anand increasingly serious problem and has been ment Sustainable Development of the China Civil Aviation, Civil infrastructure renewal and renovation, such as the expansion of runways and terminals, application of uangdong, China tronic Science Technology of from China,81.48% Zhongshan 528400, Since the late 2000s, flight delay has become an increasingly serious problem and ha decreased toand 68.33% in 2015 in 2006, 300300, China new technology, such as advanced air (S.-B.T.) traffic control technology [5,7], as well as improving operating orrespondence:
[email protected] (J.Y.);
[email protected] sity of Electronic and Technology of China, 528400, f China (CAAC)Science reports [1]. FlightStats’s June Zhongshan 2015 spreading in China. Flight on-time performance decreased to 68.33% in 2015 from 81.48% i processes and performance of airlines [8] and airports [9,10] can dramatically decrease the frequency, Y.); (S.-B.T.) eived: 22 November 2017;two Accepted: 24 January 2018; Published: 2018Aviation Administration of China (CAAC) reports [1]. FlightStats’s Jun
[email protected] China as the last carriers out of 50 main according30toJanuary the Civil scope, and extent of flight delays. These measures require significant financial investment. The .edu.cn (J.Y.);
[email protected] (S.-B.T.) [2]. The resulting inconvenience has 4rformance January 2018; Published: 30 January 2018 report also ranked China Eastern Airlines and Air China as the last two carriers out of 5 evaluation delay costs is a method to strong appraise the potential income of flight delay control, so stract: Due the influence on of theflight sectors and industries that have with the performance stitutes, mass media, and consensus and relevant international airlines inrelationships terms of on-time [2]. The resulting inconvenien Accepted: 24 to January 2018; Published: 30 January 2018 it can behave considered as athe investment boundary of delay transportation industry, flight delays have huge impact China’s In thisofgovernance. study, the institutes, mass media, and consensus and re sectorsflight and delays industries that strong relationships withon the nsive because of adverse weather that successfully drawneconomy. theflight attention research A China’s few studies focused onrelationships domestic flighteconomic delay costs inafter terms of airlines and passengers. ut–output method andindustries the Ghosh model were to analyze the impacts of ys have huge impact on economy. Inused this study, theChinese ce on thea sectors and that have strong withindirect the government departments, particularly extensive flight delays because of adverse weath [11] assessed the average delay time flight in three scenarios: delay ht onused China’s economy. We also constructed simultaneous demand-fare equations to caused by customers, flight model were to analyze the indirect economic impacts ofper flight delays have aYefu huge impact oninChina’s economy. In this study, the nddelays airport operation, resulting considerable has occurred more often in China in recent years. waiting on ground and flight placed intoimpacts adelays holding pattern. Based assessments, Yefu estimatedresulting in consid mate direct output of the air industry as a result of flight delayof control. finalthese results We alsothe constructed simultaneous demand-fare equations Ghosh model were used to analyze the indirect economic yhe impact the regional economy because of the strong Flight not onlyThe disturb airline and airport operation, wed that the total indirect impact of flight delays on China was Ұ 350.71 billion in 2013, stressing that the domestic airlines’ delay cost was 2.1 billion in 2002. Li et al. [12] found that airlines’ industry as a result of flight delay control. The final results onomy. We also constructed simultaneous demand-fare equations to and the local economy. Flight delays lead to the inconveniences to passengers, but also negatively impact the regionaldelay economy because of the importance of controlling flight delays. Since delay control not only provides direct benefits to per of flight delays on China was Ұ 350.71 billion in 2013, stressing cost was 2.45 billion in 2004, based Yefu’s assessment ofair delay time andeconomy. evaluatedFlight delays lead ofand theother air industry as ain result of transport flight delay control. The on final results institutions the air industry interactive relationship between transport andflight, the local sengers and carriers, butof also indirectly toSeveral regional economies, efforts benefit the delay elays. Since delay control not only provides direct benefits ct impact of flight delays on China was 350.71 billion in 2013, stressing flate the operating cost some industries because passengers’ loss as Ұcontributes 495 million. other studiesthe assessed the domestic cost institutions for all airlines, increase intothe purchase cost of airlines, airports, and other in the air transport in re Chinese society. The great investment inefforts flight delay governance should be shared among ectly contributes tobased regional economies, the benefit the ng delays. Since delay control notair only provides direct benefits to offlight these industries heavily on transport. by other producing sectors. Flight delays also inflate the operating of some industries b ondepend flight types or in a certain situation, using a previously-introduced method [13–15]. cost Yuxiu ious producing sectors. estment in flight delay governance should be shared among also indirectly contributes to regional economies, the efforts benefit the administrative costs, leading to an increase in the thedomestic procurement distribution of the products thesethe industries heavily and Jian [8] appraised the total flightand delay cost of Chinese airlines of based trans-log cost depend on air tra great investment in flight However, delay governance should sharedon among action of related industries to falter. Furthermore, For instance, business passenger delay increases administrative leading to an increase model. no research hasbe focused the indirect impact of flight delays on China’s costs, economy ywords: flight delay; input–output method; sustainability; indirect impact; China causes the transaction of related industries to falter. Furthe ufacturers from other associated industries, such as product’s price. This ultimately until now. In 2013, we analyzed the economic impact of flight delay. The purpose of this paper was to method; sustainability; indirect impact; China and requirement ofevaluate food, accommodation services, delays may the demands of manufacturers from other associated industries, s the indirect impact offlight flight delays onconstrain China’s economy in 2013. method; sustainability; indirect impact;tourist China services. Consequently, the consumption and requirement of food, accommodation se ,ut–output and car rental services will decrease [3]. Combined, retail sales, ground transportation, entertainment, and car rental services will decrease [3]. Com 2. www.mdpi.com/journal/sustainability Literature Review troduction Sustainability 2018, 10, x; doi: FOR REVIEW www.mdpi.com/journal/susta Due to the close relationship with other sectors, the PEER economic benefits created by the air transport Since the late 2000s, flight delay has become an increasingly serious problem and has been industry (ATI) are much larger than its own productive effects. Therefore, the development of civil ading in China. on-timeserious performance decreased 68.33% in 2015 from 81.48% in 2006, has become an Flight increasingly problem and has to been air transportation has become one of the most [1]. important driving rding to the Civil Aviation Administration of China (CAAC) FlightStats’s Juneforces 2015 of the local economy and rformance decreased toan 68.33% in 2015 serious from 81.48% in 2006, ghtJinfu delayZhu has increasingly problem and reports has been 1 become nd hasEastern caught the attention of localJune government officials, decision in the industry and research rt also performance ranked China Airlines and the last two carriers out ofmakers 50 main istration of China (CAAC) reports [1]. FlightStats’s 2015 n-time decreased to 68.33% in Air 2015China from as 81.48% in 2006, establishments. Accurately estimating the economic effects is important eronautics and Astronautics, Nanjing 211106, Jiangsu, national in terms of on-time performance inconvenience hasfor developing strategies for ines and airlines Air China the (CAAC) last two reports carriers outFlightStats’s of 50 [2]. mainThe on Administration of as China [1]. Juneresulting 2015 u.cn(J.Z.) ATI. The indirect impact of flight delays on China’s economy therelevant variance in the economic effects of essfullyAirlines drawn and the attention research mass media, and consensus is and n-time performance [2].China Theofas resulting inconvenience has astern Air the last institutes, two carriers out of 50 main Development of the China Civil Aviation, Civil Aviation the particularly airmedia, transport industry caused by flight delays. understanding the mechanism through rnment departments, after extensive flight delays because of adverse weather that esearch mass and consensus and relevant ms of institutes, on-time performance [2]. The resulting inconvenience hasAccordingly, which the local economy is impacted by air transport is necessary. occurred more often indelays Chinamass in recent years. after extensive flight because of adverse weather that ntion research institutes, media, and consensus and relevant nce andofTechnology of China, Zhongshan 528400, Economic Forecasting (OEF) constructed expanded version of the well-established Flight delays not onlyOxford disturb airline and operation, resultinganin considerable cent years. rticularly after extensive flight delays because ofairport adverse weather that nveniences to passengers, but also negatively impact the regional economy because of the strong U.K. Industry Model, which explicitly includes the aviation sector to reflect the relationship between airline and airport operation, resulting in considerable hina in recent years.
[email protected] (S.-B.T.) active relationship between air transport and the local economy. delays lead to the equations and has three impact regional economy because of the strong ATI and other producing sectors [16]. The OEF’sFlight model uses simultaneous ynegatively disturb airline the and airport operation, resulting in considerable 018; Published: 30 January 2018 ase theand purchase cost of airlines, airports, and other institutions in the air transport industryproductivity. The dynamic ransport the local economy. Flight delays lead to the , butinalso negatively impact the employment, regional economy because of the strong key factors: capital equipment available, and the sector’s ther producing sectors. Flight delays also inflate the industry operating ofand some because s, and other institutions ineconomy. the air transport ween air transport and the local Flight leadcost to the relationships among the simultaneous equations theindustries key findings of the OEF study show that the d airports, industries that have strong relationships with the delays rocurement andthe distribution of the products ofthe these industries heavily depend on air transport. ays also inflate operating cost of some industries because of airlines, airports, and other institutions in air transport industry development of critical sectors in the U.K. economy depends heavily on air transport. huge impact on China’s economy. In this study, the nstance, business passenger delay increases administrative costs, leading to an increase in the eFlight products of these industries heavily depend on air transport. delays also inflate the operating cost of some industries because Michael et al. [17] made of use of the value-added approach to calculate the direct benefits of ATI re used to analyze the indirect economic impacts uct’s price. This ultimately the heavily transaction of related industries to falter. Furthermore, increases administrative costs, leading to an increase in the tion of thesimultaneous products of these industries depend on air transport. caused bycauses accessory services totoair transport, and indirect benefits caused by tourism and trade services. nstructed demand-fare equations t delays may constrain the demands of manufacturers from other associated industries, such as sasthe transaction of related industries to falter. Furthermore, nger delay increases administrative costs, leading to an increase in the thatThe thefinal overall economic benefits of the air transportation industry in Hong Kong were a result of flightThey delayfound control. results st services. Consequently, the consumption and to requirement ds ofcauses manufacturers associated industries, suchFurthermore, as of food, accommodation services, ely the transaction of related industries falter. lays on China was Ұ from 350.71other billion in 2013, stressing 79,177.52 million (HK$84,420 million at the exchange rate on 31 December 2003) and accounted for lsumption sales, ground transportation, entertainment, and car industries, rental services and requirement of food, accommodation services, he demands of manufacturers from other associated suchwill as decrease [3]. Combined, e delay control not only provides direct benefits to rtainment, and car rental services will decrease [3]. Combined, y, the consumption and requirement of food, accommodation services, nability 2018, 10, x; doi: economies, FOR PEER REVIEW www.mdpi.com/journal/sustainability ributes to regional the efforts benefit the ation, entertainment, and car rental services will decrease [3]. Combined, n flight delay governance should be shared among W www.mdpi.com/journal/sustainability
n Empirical Study on the Indirect Impact of Flight on the Indirect Impact of Flight elay Economy tudyon onChina’s the Indirect Impact of Flight onomy ’s Economy
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7.02% of the gross domestic product (GDP) of Hong Kong in 2003. Their results also indicated that the aviation sector had a growing contribution to GDP in Hong Kong. Kenneth and Samantha [18] constructed a regression model to estimate the influence of international air traffic on U.S. employment and the local economy, with the help of a panel dataset of 41 U.S. Metropolitan Standard Areas samples. European on-plane passengers, European airports, and total enplanements were three independent variables in the complicated regression equation that represented air transportation. In the study of Kenneth and Samantha, they categorized the economic benefits into primary effects, secondary effects, tertiary effects, and perpetuity effects. Mobolaji et al. [19] also built a regression equation with passenger throughput as the dependent variable, and Article revenues and GDP as the independent variables, to study the relationship between air traffic and the Nigerian economy. They found that the aviation industry creates only 90% of the expected passenger Article throughput and contributions to the Nigerian GDP. The input–output (I-O) method is another methodology used in estimating the macroeconomy and analyzing linkage effects. The input–output method was proposed by Wassily Leontief in 1936. 1,2 2,*, Sang-Bing Tsai 2,3,* and Jinfu Zhu 1 Yuxiu Chen It makes use of general equilibrium theory, Jian and Yu a chessboard I-O table to conduct empirical research 1 into a quantitative dependenceCollege relationship economicofactivities [20]. studiesNanjing 211106, Jiang of Civil among Aviation,various Nanjing University Aeronautics andMany Astronautics, 1,2, Jian Yu 2,*, Sang-Bing Tsai 2,3,* and Jinfu Zhu 1 Yuxiu Chen used
[email protected] (Y.C.);
[email protected](J.Z.) the I-O method to analyzeChina; the macroeconomy, including economic benefits, growth ability, and 2 Center forAstronautics, Environment and Sustainable Development of the China Civil Aviation, Civil Av 1 College of evolutionary featuresUniversity of someofResearch industries [21–28]. The transportation industry has strong mutual Civil Aviation, Nanjing Aeronautics and Nanjing 211106, Jiangsu, University of China, Tianjin 300300, China China;
[email protected] (Y.C.);
[email protected](J.Z.) interdependence with other economic sectors, and this complementary relationship indicates that 3 Zhongshan Institute, University of Electronic Science and Technology of China, Zhongshan 528400, 2 Research Center for Environment and Sustainable Development of the China Civil Aviation, Civil Aviation transportation growth promotesGuangdong, other industries China and the entire economy [29]. Hence, the I-O method 1,2 2, 2,3, 1 University of China, Tianjin 300300, China hen , Jian Yu *, Sang-Bing * and Jinfu is suitableTsai for examining theZhu
[email protected] of transport issues. As a professional institution of *economic Correspondence: (J.Y.);
[email protected] (S.-B.T.) 3 Zhongshan Institute, University of Electronic Science and Technology of China, Zhongshan 528400, the United Nations, the International Civil Aviation Organization (ICAO) recommends using the ge of Civil Aviation, Nanjing University of Aeronautics and Astronautics, Nanjing 211106, Jiangsu, Guangdong, China Received: 22 November 2017; Accepted: 24 January 2018; Published: 30 January 2018 ;
[email protected] (Y.C.);
[email protected](J.Z.) I-O method to appraise
[email protected] contribution of air transport to the national economy. With the help of * Correspondence:
[email protected] (J.Y.); (S.-B.T.) rch Center for Environment and Sustainable Development of the China Civil Aviation, Civil Aviation the I-O method, the ICAO indicates that indirect effects of sectors air transport on local, regional, or relationships wi Abstract: Due the to the on the and industries that have strong Received: 22 November 2017; Accepted: 24 January 2018; Published: 30influence January 2018 rsity of China, Tianjin 300300, China national economies include the catalytic and induced demand effects of the output and jobs upon air transportation industry, flight delays have a huge impact on China’s economy. In this stud gshan Institute, University of Electronic Science and Technology of China, Zhongshan 528400, other industries throughout the economy. Catalytic demand effects include off-airport expenditures input–output method the Ghosh model werewith used to analyze the indirect economic impa Abstract: Due to the influence on the sectors and industries that and have strong relationships the gdong, China directly related to thedelays use ofhave air travel and shipment ofeconomy. freight and and induced demand effects flight delays on China’s Wemail, also constructed demand-fare equatio air transportation industry, flight a(S.-B.T.) huge impact on China’s economy. In this study, the simultaneous spondence:
[email protected] (J.Y.);
[email protected] are consumer spending from income earned through direct and catalytic economic activities and public estimate the direct output of the air industry as a result of flight delay control. The final r input–output method and the Ghosh model were used to analyze the indirect economic impacts of d: 22 November 2017; Accepted: 24 January 2018; Published: 30 January 2018 showed that the total indirect impact of flight delays on China was Ұ 350.71 expenditures from related In the global economy, the ICAO found to that every 827.85 billion in 2013, stre flight delays on China’s economy. We tax alsorevenues. constructed simultaneous demand-fare equations importance of controlling flight delays. delay control only provides direct bene U.S. at theofexchange ratethe onthat 31 ofdelay output produced and every jobsnot generated estimate the($100 direct output the industry as December a result of2002) flight control. TheSince final results100 t: Due to the influence on the sectors andair industries have strong relationships with the passengers and carriers, but also indirectly contributes to regional economies, showed that the total indirect impact of flight delays on China was Ұ 350.71 billion in 2013, stressing by air transport triggers an additional demand of 2690.51 ($325 U.S. at the exchange rate on 31 the efforts bene sportation industry, flight delays have a huge impact on China’s economy. In this study, the entire Chinese society. The great investment in flight delay governance should be shared a the importance of controlling flight delays. Since delay control not only provides direct benefits to 610 jobstoinanalyze other industries [30]. The U.S. Federal utput method and December the Ghosh 2002) modeland were used the indirect economic impacts of Aviation Administration (FAA) various producing sectors. passengers and carriers, also indirectly contributes to the regional economies, the benefit Bureau the used the adjusted I-O model developed by U.S. Department of efforts Commerce’s of Economic elays on China’s economy. Webut also constructed simultaneous demand-fare equations to entireoutput Chinese The greatasinvestment flight delay governance should be shared among Analysis, determine economic impacts ofcontrol. ATI spending [31]. The FAA’s estimated result showed e the direct of society. the airtoindustry athe result of in flight delay The final results Keywords: flight delay; input–output method; sustainability; indirect impact; China producing sectors. that thevarious total indirect of flightaviation delays on China was Ұ 5310.31 350.71 billion in($807.1 2013, stressing thatimpact commercial contributed billion billion U.S. at the exchange rate on 31
An Empirical Study on the Indirect Impact of Fligh on China’s Economy An Empirical Study onDelay the Indirect Impact of Flight Delay on China’s Economy
mpirical Study on the Indirect Impact of Flight y on China’s Economy
ortance of controlling flight delays. Since delay control December 2012) or 5.1% to U.S. GDPnot in only 2012.provides direct benefits to flight input–output method; sustainability; indirect impact; China gers andKeywords: carriers, but alsoIndelay; indirectly contributes to regional economies, the efforts this paper, the ICAO’s suggestion is considered, andbenefit the I-Othe method was adopted to evaluate Chinese society. The great investment in flight delay governance should be shared among the contribution of flight delay control to China’s economy. The remainder of this paper is organized 1. Introduction producing sectors.as follows. Section 3 describes the methodology and presents the data. Section 4 discusses the findings Since the late 2000s, flight delay has become an increasingly serious problem and has from the study. Section 5 draws conclusions and discusses potential future studies in flight delay 1. Introduction rds: flight delay; input–output method; sustainability; indirect impact;Flight Chinaon-time performance decreased to 68.33% in 2015 from 81.48% in spreading in China. cost estimating. to the Civil Aviation Administration China Since the late 2000s, flight delay hasaccording become an increasingly serious problem andofhas been(CAAC) reports [1]. FlightStats’s June report also rankedtoChina and Air China as the last two carriers out of 50 spreading in China. Flight on-time performance decreased 68.33%Eastern in 2015Airlines from 81.48% in 2006, international terms[1].ofFlightStats’s on-time performance according to the Civil Aviation Administration of Chinaairlines (CAAC)in reports June 2015 [2]. The resulting inconvenienc uctionreport also ranked China Eastern Airlines successfully drawn the attention of research institutes, and Air China as the last two carriers out of 50 mainmass media, and consensus and rel government departments, after extensive flight airlines terms of on-time performance [2]. Theparticularly resulting inconvenience has delays because of adverse weathe e the international late 2000s, flight delayinhas become an increasingly serious problem and has been has occurred more often in China in recent years. successfully drawn the attention of research institutes, mass media, and consensus and relevant g in China. Flight on-time performance decreased to 68.33% in 2015 from 81.48% in 2006, Flight delays not only disturb airlineweather and airport operation, resulting in conside government departments, particularly after extensive flight[1]. delays because of adverse that g to the Civil Aviation Administration of China (CAAC) reports FlightStats’s June 2015 inconveniences to passengers, but also negatively impact the regional economy because of the s has occurred more often in China years. so ranked China Eastern Airlines and in Airrecent China as the last two carriers out of 50 main interactive relationship between air transport and the local economy. Flight delays lead t Flight delays ofnot only disturb airline[2]. and operation, resultinghas in considerable onal airlines in terms on-time performance Theairport resulting inconvenience increase in theand purchase cost of airlines, airports, and other institutions in the air transport ind inconveniences to passengers, also negatively impact the regional economy because of the strong ully drawn the attention of researchbut institutes, mass media, consensus and relevant by other producing sectors. Flight delays also inflate the interactive relationship between air transport and the local economy. Flight delays lead to theoperating cost of some industries be ent departments, particularly after extensive flight delays because of adverse weather that the procurement and distribution of the products of these industries heavily depend on air tran increase in the purchase cost of airlines, airports, and other institutions in the air transport industry rred more often in China in recent years. For instance, business passenger delay increases administrative costs, leading to an increase by other sectors. Flight delays also operation, inflate the operating of some industries because ht delays not producing only disturb airline and airport resulting cost in considerable product’s price. This ultimately causes the transaction of related industries to falter. Further procurementbut and distribution the products of these industries heavily depend on air transport. iencesthe to passengers, also negativelyofimpact the regional economy because of the strong flight mayFlight constrain the demands manufacturers For instance, business delaythe increases administrative costs, leading to the anofincrease in the from other associated industries, su ve relationship between air passenger transport and local delays economy. delays lead to tourist services. Consequently, the consumption and requirement of food, accommodation ser product’s price. This ultimately causes the transaction of related industries to falter. Furthermore, in the purchase cost of airlines, airports, and other institutions in the air transport industry
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3. Methodology The I-O table is the analytical base of the I-O method. The table reveals the source of inputs and the application of outputs for every producing sector within a certain period. The table can be mainly split into three parts. Table 1 represents the basic I-O table. zij in Quadrant I shows the service or production provided by one sector to the producing process of other sectors from the transverse direction, and the service or production produced by other sectors that one sector consumes in their producing process from the vertical direction. f i in Quadrant II reveals the final use of the total outputs of sector i and reveals the application of some goods and services that have permanently or temporarily withdrawn from the current producing cycle. In Quadrant III, v j shows the value added of formation and composition, which is also called the primary input. Intermediate Use of Quadrant I and Final Use of Quadrant II illustrate the total outputs xi . The Intermediate Inputs of Quadrant I and Value Added of Quadrant III illustrate the total inputs x j . xi is equal to x j . In the I-O method, quantitative dependence among various sectors can be described through a system of linear equations, and the quantitative dependence is usually studied by several coefficients that are introduced into linear equations. 3.1. Ghosh Model One of the two approaches to analyzing linkage effects among the producing sectors is examining the forward linkage [32]. Increased output in sector j means that additional amounts of product j are available to be used as inputs in other sectors for their own production. This means increased supplies from sector j (as a seller) are available for the sectors that use good j in their production. Such interconnection is called forward linkage [33]. Forward linkage measures the relationship among various sectors from the supply side. For instance, increased air traffic due to valid flight delay control creates advantages for certain sectors whose operation depends heavily on air transport or uses air service as important intermediate inputs. Similarly, expanding the producing capacity of these sectors stimulates their demand for inputs. This influence can spread to the entire economy through the same mechanism. The Ghosh model [34] is often suggested as being more appropriate for computing forward linkage [33,35,36]. Hence, the Ghosh model was also used in this study to analyze the impact of flight delays on China’s economy.
Received: 22 November 2017; Accepted: 24 January 2018; Published: 30 January 2018
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Output
Sector 1
Abstract: Due to the influence on the sectors and industries that have strong relationships with the air transportation industry, flight delays have a huge impact on China’s economy. In this study, the input–output method and the Ghosh model were used to analyze the indirect economic impacts of flight delays on China’s economy. We also constructed simultaneous demand-fare equations to estimate the direct output of the air industry as a result of flight delay control. The final results showed that the total indirectTable impact of flight delays on table Chinaform was( Ұ ).350.71 billion in 2013, stressing 1. Basic input–output the importance of controlling flight delays. Since delay control not only provides direct benefits to Intermediate Use carriers, but also indirectly contributes to regional Final Use passengers and economies, the efforts benefit the Total Final Consumption Expenditure Gross Capital Formation entire Chinese society. The great investment in flight delay governance should be shared among Household Consumption Total Gross various producing sectors. Government ... ... Expenditure Changes in Sector n Intermediate Use
Keywords: flight delay;
Output
Fixed Consumption Total Inventories Capital Rural Urban Expenditure Total Formation Household Household input–output method; sustainability; indirect impact; China
Total
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Total Exports Final Use
Imports Errors
Total Output
Sector 1 ... ... Intermediate Inputs
Sector n Total Intermediate Inputs Compensation of Employees
Value Added
Net Taxes on Production Depreciation of Fixed Assets Operating Surplus
Total Inputs
I zij
II fi
1. Introduction Since the late 2000s, flight delay has become an increasingly serious problem and has been spreading in China. Flight on-time performance decreased to 68.33% in 2015 from 81.48% in 2006, according to the Civil Aviation Administration of China (CAAC) reports [1]. FlightStats’s June 2015 III ranked China Eastern Airlines and Air China as the last two carriers out of 50 main report also vj international airlines in terms of on-time performance [2]. The resulting inconvenience has successfully drawn the attention of research institutes, mass media, and consensus and relevant government departments, particularly after extensive flight delays because of adverse weather that xj has occurred more often in China in recent years. Flight delays not only disturb airline and airport operation, resulting in considerable inconveniences to passengers, but also negatively impact the regional economy because of the strong interactive relationship between air transport and the local economy. Flight delays lead to the increase in the purchase cost of airlines, airports, and other institutions in the air transport industry by other producing sectors. Flight delays also inflate the operating cost of some industries because the procurement and distribution of the products of these industries heavily depend on air transport. For instance, business passenger delay increases administrative costs, leading to an increase in the product’s price. This ultimately causes the transaction of related industries to falter. Furthermore, flight delays may constrain the demands of manufacturers from other associated industries, such as tourist services. Consequently, the consumption and requirement of food, accommodation services, retail sales, ground transportation, entertainment, and car rental services will decrease [3]. Combined, Sustainability 2018, 10, x; doi: FOR PEER REVIEW
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xi
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The Ghosh model reflects the relationship between value added and total outputs by using a direct allocation coefficient (the vector in this paper was defaulted to a column vector, with the superscript 0 representing the transposed matrix): X 0 = V 0 ( I − H ) −1 (1) 0
where X is the column vector of the total output and is specified as X = ( x1 x2 · · · xn ) , V is the 0 column vector of the value added and is specified as V = (v1 v2 · · · vn ) , I is the identity matrix, and H is frequently called allocation coefficients matrix with the element hij . We used hij to represent the allocation coefficient. These hij coefficients represent the distribution of sector i’s outputs across sector j that purchase interindustry inputs from i. The larger the hij , the greater the direct driving force of sector i on sector j. hij is calculated as zij /xi . We defined: e = ( I − H ) −1 G
(2)
with the element geij , where geij is called an output-to-primary-input multiplier and represents the augmentation of sector j’s total outputs due to a single unit augmentation of the primary input in sector i. The larger the gij , the greater the complete driving force of sector i on sector j. Row sums of n
e ∑ geij = gei1 + · · · + gein , represent the effect on total output throughout all sectors of the economy G, j =1
that would be associated with a single unit change in primary inputs for sector i [36]. These row sums e is commonly called Ghosh inverse, compared to the usual Leontief are called supply multipliers. G Article inverse. Then, the Ghosh model can be described as:
An Empirical Study on the Indirect Impact of Fligh 0 e = V 0 G. (3) Delay on XChina’s Economy
In terms of changes in V, the associated output changes would be found as: Yuxiu Chen 1,2, Jian Yu 2,*, Sang-Bing Tsai 2,3,* and Jinfu Zhu 1 0 0e 1 College of Civil ∆X = ∆VNanjing G (4)Nanjing 211106, Jiang Aviation, University of Aeronautics and Astronautics, China;
[email protected] (Y.C.);
[email protected](J.Z.)
2 Research Center for Environment and Sustainable Development of the China Civil Aviation, Civil Av Equation (4) indicates that we can evaluate the impact of flight delays on China’s economy University of by China, Tianjin 300300, through the changes of value added caused flight delays and China Ghosh inverse. Since only the changes 3 Zhongshan Institute, University of Electronic Science and Technology of China, Zhongshan 528400, of value added of air transport sector k was measured in this paper, other sectors’ output was set Guangdong, China to be 0, and ∆V 0 was described as (0, . . . , ∆Vk ,
[email protected] . . , 0)0 . As shown in Quadrant III of Table 1, the four * Correspondence: (J.Y.);
[email protected] (S.-B.T.) value-added elements are: compensation of employees, depreciation of fixed assets, net taxes on Received: 22 November 2017; Accepted: 24 January 2018; Published: 30 January 2018 production, and operating surplus. The changes in added value of ATI caused by flight delays are the variation in these four elements. Abstract: Due to the influence on the sectors and industries that have strong relationships wi
air transportation industry, flight delays have a huge impact on China’s economy. In this stud 3.2. Simultaneous Demand and Fare Equations input–output method and the Ghosh model were used to analyze the indirect economic impa As the principal part of ATI of China the operating costs and revenue of Chinese airlines are flight delays[37], on China’s economy. We also constructed simultaneous demand-fare equatio the main operating surplus ofestimate ATI, which influenced flight delays [4,5,38]. According Yuxiucontrol. The final r the are direct output ofbythe air industry as a result of flighttodelay that thecosts total of indirect impact of flight ondelay Chinawere was Ұ 107.13 350.71 billion in 2013, stre and Jian [8], the variation of inshowed the operating Chinese airlines due delays to flight the importance of controlling flight delays. Since delay control not only provides direct bene billion in 2013. Then, the variation in revenue remains to be determined. passengers and carriers, but also indirectly contributes to regional economies, Airline revenue is influenced by the air ticket fare and air passenger demand. These two factors the efforts bene Chinese society. Thewas great investmentto inexamine flight delay are interactional. Therefore, aentire simultaneous equation constructed the governance relationshipshould be shared a various producing sectors. between these two elements to calculate the effects of flight delays. Then, the variation in revenue was
calculated as the product of fare and the variation in passenger demand, which can be derived from Keywords: flight delay; input–output method; sustainability; indirect impact; China the simultaneous formulas. Air traffic volume and fare are affected by supply, demand, and air market structure. Supply is determined by passenger demand, input price, route length, and market competition situation [39–42]. Demand is determined by the [43], the economy of departure and destination locations, residents’ 1. fare Introduction income situation [44], and the route length [45]. Some studies indicated that fare and demand are Since the late 2000s, flight delay has become an increasingly serious problem and has spreading in China. Flight on-time performance decreased to 68.33% in 2015 from 81.48% in according to the Civil Aviation Administration of China (CAAC) reports [1]. FlightStats’s June report also ranked China Eastern Airlines and Air China as the last two carriers out of 50 international airlines in terms of on-time performance [2]. The resulting inconvenienc successfully drawn the attention of research institutes, mass media, and consensus and rel
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influenced if a low cost air service exists on the same route or in adjacent cities [42,46–49]. Several newly formed airline companies in China advertise that they provide no-frill air service, but ground infrastructure, rules, regulations, and customer maturity levels in the Chinese air market are not suitable for low cost operations. As a result, the impacts of low cost airlines and no-frill service in the Chinese air market is not currently understood. Flight delays have become an emerging determinant of passenger demand and fare. Due to the increasing inconvenience due to delays, passenger desire to travel by air will decrease, particularly in the short term because of the ease of acquiring information about delays and carrier performance. Meanwhile, flight delays may increase the input expense and reduce aircraft utilization, and this will affect carriers’ operating costs and earnings, and eventually increase the fare in the long term. Most flight delays occur in busy airports and affect carriers’ subsequent operations [38]. Therefore, whether the departure or destination point is at a busy airport was another explanatory factor used in the simultaneous equation. Hence, adapting Britto’s model to the Chinese air market [50], the simultaneous model for a given airline on a given route for a given year is given in Equation (5): lnFare = ϕ0 + ϕ1 Delaylag_SA + ϕ2 lnPassengers + ϕ3 lnLength + ϕ4 lnCompetition + ϕ5 Busy + ϕ6 Yeart lnPassengers = ρ0 + ρ1 Delaylag_A + ρ2 lnFare + ρ3 lnIncome + ρ4 lnGDP + ρ5 Yeart
(5)
where Fare is the average ticket price on a given route for a given year, Passengers is the number of passengers carried by an airline on a route in a given year, Length is the route length, and Competition is the market competition situation on a route for a year and is usually measured by the degree of market concentration. Busy is a dummy variable set to be 1 if the departure or arrival airport is a busy airport and 0 otherwise. We used the definition of busy airport in the study of Jian et al. [38], where it is defined as an airport with yearly throughput of more than 10 million passengers. GDP is the production of the gross domestic product of the departure and arrival cities on a route for a year, Income is the population-weighted average income of the departure and arrival cities on a route for a year, and Year is a time variable. Our routes panel dataset covered three years from 2011 to 2013. The value of year 2011 was set to be 2011, year 2012 was set to be 2012, and year 2013 was set to be 2013. Delaylag_SA and Delaylag_A are delay values for an airline on a route for a year and are the two factors we are most concerned about in this paper. The lagged value of delay is used in the model because the behavior of passengers and carriers is always influenced by previous delay situation [50]. Delaylag_A is one of the delay types that occur when actual flight arrival times are later than scheduled arrival time. Passenger behavior is mainly affected by Delaylag_A, for it is the delay that the passengers think they really experience. To increase the performance appraisal, airlines always add an interval to their optimal flight time to establish the flight schedule. Both the interval added and Delaylag_A, which is called Delaylag_SA in this article, will increase the airline’s operating cost and increase the fare as a result, in the long run. The Herfindahl–Hirschman index (HHI) was used to evaluate the extent of the air market competition. HHI can be calculated as HH I = ∑in=1 Si 2 , where Si is the market share of carrier i in a route and n is the numbers of carriers operating on a route. Because of the magnifying function of the quadratic sum in the model, HHI is responsive to non-uniform market share and reveals the influence of the size difference on the degree of market concentration [51–54]. HHI’s value is between 0 and 1. The greater the HHI, the closer the market is to being monopolistic and the stronger the pricing situation is for carriers operating on that route. Conversely, with a lower HHI, the air market is more competitive and average fares are usually much lower. 4. Data The National Bureau of Statistics (NBS) of China began preparing I-O tables in 1987 at five-year intervals. After 2002, the Chinese I-O tables were categorized into 42-sector tables and more detailed
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139-sector tables, which include the data from the air transport sector. The latest I-O table including 139 sectors was published in 2012 [55] and it was adopted to 2013 for this article. The flight delay data was gathered from the Flight Delay Database (FDD) of the Research Center for Environment and Sustainable Development of the China Civil Aviation (RCESD), which is a think tank of CAAC. To construct simultaneous equations of passenger demand and airfare, the Official Aviation Guide (OAG) route data about passengers, fares, and route length for each domestic route for each carrier from 2011 to 2013 was used to calculate HHI for each route. We validated tens of thousands of route data points captured by OAG, and the final sample included 4663 observations broken down into 1144 observations for 2011, 1183 for 2012, and 2336 for 2013. The Statistical Yearbook (SY) of each city annually publishes urban per capita disposable income, permanent resident population, ng Tsai 2,3,* and Jinfu Zhu 1 and the GDP of the city. We gathered these data from hundreds of SYs published on the website of niversity of Aeronautics Astronautics, Jiangsu, eachand city’s statisticalNanjing bureau.211106, The Production Statistical Communiqué of National Airports, established
[email protected](J.Z.) by the CAAC, reports the passenger throughput of all the airports every year. These data were used d Sustainable Development of the China Civil Aviation, Civil Aviation to define the busy airports from 2011 to 2013. To be cautious, the 20th percentile of the feasible flight China for a given carrier on a given route for a given year from 2011 to 2013 was used as the optimal lectronic Science andtime Technology of China, Zhongshan 528400, flight time 1 [4,56] to compute Delaylag_SA. Table 2 provides the descriptive statistics for the variables in ing Tsai 2,3,* and Jinfu Zhu (J.Y.);
[email protected] (S.-B.T.) the simultaneous equations. Table 3 displays the correlation matrix for the variables. No correlation 2,3, 1 ng Tsai * and Jinfu Zhu University of Aeronautics and Astronautics, Nanjing 211106, Jiangsu, coefficients exceed 0.5 except Delaylag_SA and Delaylag_A. The VIF scores are also detected for all d:
[email protected](J.Z.) 24 January 2018; Published: 30 January 2018 University of Aeronautics and Astronautics, Nanjing 211106, Jiangsu, independent variables and all values less than 5.0, which indicates that multicollinearity was not and Sustainable Development of the China Civil Aviation, Civil Aviation
[email protected](J.Z.) seriousthat he sectors and industries have strong the 0, China nd Sustainable Development of[57]. the China Civil relationships Aviation, Civil with Aviation elays have a huge impact on China’s economy. In this study, Electronic Science and Technology of China, Zhongshan 528400, the China Table 2. Descriptive statistics (N = 4663). Electronic and Technology China, Zhongshan 528400, sh modelScience were used to analyze of the indirect economic impacts of n (J.Y.);
[email protected] (S.-B.T.) . We also constructed simultaneous demand-fare equations to (J.Y.);
[email protected] (S.-B.T.) Minimum Mean SD air a result of Variable flight delay 2018 control. The final resultsMaximim ed: industry 24 Januaryas 2018; Published: 30 January ct 24 of January flight delays on ChinaFare was billion2.0000 in 2013, stressing 967.0000 145.5514 88.0943 ( Ұ )350.71 d: 2018; Published: 30 January 2018 Passengers (No.) 597.0000 1,411,977.0000 72,916.3380 91,544.6550 tthe delays. Since control nothave onlystrong provides direct benefits sectors anddelay industries that relationships with to the (min) 30.4189 24.6283 he sectors and industries that strong relationships with the directly contributes toDelaylag_A regional economies, the 0.0000 efforts benefit delays have a huge impact on have China’s economy. In this study, the382.8900 Delaylag_SA (min) 5.6000 612.6800 50.8108 26.2665 delays have were a huge impact on China’s economy. Inshared this study, theof nvestment in flight delay governance shouldeconomic be among osh model used to analyze the indirect impacts Length (km) 143.0000 3310.0000 1096.3005 523.5194 sh We model were used to analyze the indirect economic impacts ofto 1.0000 y. also constructed simultaneous demand-fare equations Competition 0.1367 0.4483 0.2552 .air Weindustry also constructed demand-fare to 1.0000 as a resultsimultaneous of Busy flight delay control. Theequations final results 0.0000 0.9801 0.1398 put method; sustainability; indirect impact; China air as a result of flight control. The finalstressing results45,104.9689 actindustry of flight delays on China was(delay Ұ )350.71 billion in 2013, 14,692.0924 33,351.4095 5604.0563 Income ct of flight Since delaysdelay on China was billion indirect 2013,benefits stressing 7,558,604,002 42,125,430,127,200,000 6,044,669,000,215,000 6,585,541,391,333,720 GDP ( Ұ )350.71 ht delays. control not only provides to tndirectly delays. Since delay control not economies, only provides contributes to regional thedirect effortsbenefits benefit to the directly contributes regional economies, the efforts benefit the investment in flighttodelay governance should be shared among Table 3. Correlations. nvestment in flight delay governance should be shared among
y on the Indirect Impact of Flight conomy
y on the Indirect Impact of Flight y on the Indirect Impact of Flight Economy conomy
Year Fare Passenger Delaylag_A ay has become an increasingly serious problem and has been Year68.33% 1 impact; tput method; decreased sustainability; indirect China performance to in 2015 from 81.48% in 2006, Fareindirect −0.131 * 1 put method; sustainability; impact; China ministration of China (CAAC) reports [1]. FlightStats’s June 2015 Passenger
0.016
−0.262 *
Delaylag_SA Length
Competition
Busy
Income GDP
1
−0.047 out−0.034 Airlines and Air ChinaDelaylag_A as the last0.086 two carriers of 50 main1 Delaylag_SA 0.089 0.063 0.058 0.876 * 1 on-time performance Length [2]. The 0.008 resulting0.487 inconvenience has * 0.114 * −0.061 0.065 1 Competition −0.135 * − 0.203relevant * 0.066 0.048 −0.189 * 1 f research institutes, mass media,0.015 and consensus and Busy −0.01 0.101 * 0.072 0.008 0.055 0.101 * −0.168 * 1 rly after flight delays because adverse weather elay has extensive become an increasingly serious and been Income 0.424 * of problem 0.229 * 0.18 * has that 0.054 0.149 * 0.093 0.039 0.177 1 GDP 0.066 0.246 * 81.48% 0.469has * inbeen −0.044 0.081 0.066 −0.237 * 0.108 0.369 1 has years. becomedecreased an increasingly serious problem and recent eay performance to 68.33% in 2015 from 2006, denotes an performance decreased tooperation, 68.33% in resulting 2015 from*in81.48% in absolute 2006, rb airline and airport considerable ministration of China (CAAC) reports [1]. Note: FlightStats’s June 2015 value of the correlation coefficient ≥0.1. ministration ofimpact China (CAAC) reports [1]. carriers FlightStats’s June 2015 so negatively the regional economy becauseout of the strong Airlines and Air China as the last two of 50 main Airlines andperformance Air the China as[2]. the The last two carriers out lead of 50tomain rf transport and local economy. Flight delays the on-time resulting inconvenience has 5. Results on-time performance [2]. The resulting inconvenience has nes,research airports,institutes, and othermass institutions theconsensus air transport of media, in and andindustry relevant We media, used the I-O table forrelevant 139 sectors to calculate the supply multiplier of air transport farly research institutes, mass and consensus and delays alsoextensive inflate the operating of2012 some industries because after flight delayscost because of adverse weather that sector. The final result was 3.756134, which rly after extensive flight delays because of adverse weather that indicated that the total output throughout all sectors of the products of these industries heavily depend on air transport. n recent years. China economy would bean changed 3.756134 recent years.and lay increases administrative costs, leading to increase in the units associated with a single unit change in primary urb airline airport operation, resulting in considerable inputs for air transport sector. The output-to-primary-input multipliers of air transport sector are urb andimpact airport operation, resulting in Furthermore, considerable ses airline the transaction of the related industries to falter. also negatively regional economy because of the strong shown from high to low in Table S1. ATI in China strongly supports the development of tertiary so negatively impact the regional economy because of the strong ands of manufacturers from economy. other associated such air transport and the local Flight industries, delays lead to as the r transport and the localinstitutions economy. delays lead to the onsumption and requirement of food,inFlight accommodation services, lines, airports, and other the air transport industry nes, airports, other institutions in of the air transport industry ntertainment, and car rental services will decrease [3]. Combined, delays also inflate the operating cost some industries because delays also inflate the operating of some industries because of the products of these industriescost heavily depend on air transport. IEW www.mdpi.com/journal/sustainability the products of these industries heavily depend on air transport. delay increases administrative costs, leading to an increase in the lay increases administrative costs, leadingtotofalter. an increase in the auses the transaction of related industries Furthermore,
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industry, especially public management and social organization, business services, wholesale and retail trade, monetary intermediation and other financial services, and education sectors. In addition, modern secondary industry will struggle to develop without the help of ATI, including the building construction, electronic components and parts manufacturing, steel rolling processing manufacturing, and motor vehicles manufacturing. Overall, the data indicate that ATI is a powerful driving force in China’s economy, which also means flight delays will take huge impacts to China’s economy, especially to the tertiary industry and modern secondary industry. The two-stage least squares (TSLS) method was used to estimate the simultaneous equations using Eviews 7.2 software (IHS Global Inc., Irvine, CA, USA). The first step was to transfer the structural equation models to reduced-form models. Because a stochastic explanatory variables problem was not present, the reduced-form models were estimated using the Ordinary Least Squares method (OLS). ˆ which was determined The second step was to replace the dependent variable Y with the estimator Y, in the first step. These replaced models can be estimated with OLS. TSLS is the combination of the Indirect Least Square method (ILS) and the Instrumental Variable method (IV). TSLS overcomes the inapplicability of ILS in over identified structural models and the difficulty of choosing instrumental variables in IV [58,59]. Table 4 displays the estimation results. Income in the passenger model was removed, as the t-statistics value was indistinctive in the first stage of assessment. Table 4. Fares and passengers simultaneous equations estimates. t-Statistic
Coefficient lnFare
—— Constant Delaylag_SA lnPassengers lnLength lnCompetition Busy Year
195.1847 *** 0.000826 ** 0.281956 *** 0.464754 *** 0.087798 *** 0.269863 *** −0.09784 ***
Constant Delaylag_A lnFare lnGDP Year
−115.768 *** −0.00039 ** 0.410599 *** 0.142424 *** 0.059377 ***
lnPassengers
Article
7.991221 2.167238 25.63891 22.67013 4.068926 3.727018 –8.05993 ——
−3.70762 −2.25357 24.35224 15.02245 3.825059
An Empirical Study on the Indirect Impact of Flight Delay on China’s Note: *** Economy p < 0.01, ** p < 0.05. 1,2, Jian Yu 2,*, Sang-Bing Tsai 2,3,* and Jinfu Zhu 1 The signsYuxiu of theChen coefficients confirm our expectations. In the fare model, Passengers, Length, 1 College Competition, Busy, and Delaylag_SA wereNanjing positive. This indicates that these coefficients, in particular of Civil Aviation, University of Aeronautics and Astronautics, Nanjing 211106, Jiangsu, China;
[email protected] [email protected](J.Z.) delays, have an increasing impact on fares.(Y.C.); In contrast, the minus sign of Year indicates the downward 2 Research Center for Environment and Sustainable Development of the China Civil Aviation, Civil Aviation trend of the average fare price in the Chinese air transportation market, as expected. In the passenger University of China, Tianjin 300300, China model, the signs mean that economy development has a positive impact on air demand, but delays 3 Zhongshan Institute, University of Electronic Science and Technology of China, Zhongshan 528400, have a negative impact. It was Guangdong, Chinaunexpected that the fare level would have a positive sign in the demand model.* This may be
[email protected] to the rapid growth in demand in the Chinese Correspondence: (J.Y.);
[email protected] (S.-B.T.)air market. Despite increasing fare levels, increasing numbers of passengers travel by air for convenience, comfort, and Received: 22 November 2017; Accepted: 24 January 2018; Published: 30 January 2018 ease, especially in the eastern and southern parts of China where the average income is much higher. In addition, theAbstract: higher fares notinfluence affect theon decisions of and passengers to that travel by strong air. However, this with the Due do to the the sectors industries have relationships trend may change as the Chinese air market matures in the future when more choices for air service air transportation industry, flight delays have a huge impact on China’s economy. In this study, the are available, particularly when service provided by lowwere costused carriers. input–output method andisthe Ghosh model to analyze the indirect economic impacts of Delays cause more concern in our economy. study. Delaylag_A was −0.00039. This implies the demand flight delays on China’s We also constructed simultaneous demand-fare equations to will decrease byestimate 0.039% the withdirect everyoutput additional flight delay. determined by the Civil of theone air minute industryofas a result of As flight delay control. The final results showed that the the totalaverage indirect fare impact delaysair on China 350.71 billion in were 2013, stressing Aviation Statistical Yearbook, in of theflight domestic marketwas is Ұ 789, and there the importance of controlling flight delays. control not onlyinprovides direct 327.42 million domestic passengers in 2013. As counted bySince FDD,delay average Delaylag_A 2012 was 32.44benefits to passengers and carriers, but also indirectly contributes to regional economies, the efforts benefit the entire Chinese society. The great investment in flight delay governance should be shared among various producing sectors.
Keywords: flight delay; input–output method; sustainability; indirect impact; China
he Indirect Impact ofAccepted: Flight Received: November of 2017; 24 January Electronic Science and22Technology China, Zhongshan 528400,2018; Published: 30 January 2018 (J.Y.);
[email protected] (S.-B.T.) my n (J.Y.);
[email protected] (S.-B.T.) Abstract: Due to the influence on the sectors and industries that have strong relationships with the
d: 24 January 2018; Published: 30 January 2018
air2018; transportation industry, flight delays have a huge impact on China’s economy. In this study, the 24 January Article *d:and Jinfu Zhu 1 Published: 30 January 2018 input–output method and the Ghosh model were used to analyze the indirect economic impacts of he sectors and industries that 2018, have strong Sustainability 10, 357 relationships with the 10 of 13 Article f Aeronautics and Astronautics, Nanjing 211106, Jiangsu, flight delays on China’s economy. We alsostudy, constructed delays haveand a huge impact that on China’s economy. In this the sectors industries have strong relationships with the the simultaneous demand-fare equations to .edu.cn(J.Z.) estimate the output of the economic air industry as a the result of flight delay control. The final results sh model were usedimpact to direct analyze the indirect of delays have a huge on China’s economy. In thisimpacts study, ble Development of the China Civil Aviation, Civil Aviation that total indirect impact of flight delays to on China was 350.71 billion in 2013, stressing min. Then, carrier revenue was estimated by Ұ 3.27 billion due to flight delays. As has been . We also showed constructed simultaneous demand-fare equations osh model were used tothe analyze the indirect economic impacts of decline the importance of controlling flight delays. Since delay control not only provides direct benefits to due to flight evaluated by Yuxiu and Jian [8], the increase in the operating costs of Chinese airlines air industry as a result of flight delay control. The final results y. We also constructed simultaneous demand-fare equations to cience andYuxiu Technology of1,2China, Zhongshan 528400, Tsai 2,3,* and Jinfu Zhu 1 2,*, Sang-Bing Chen , Jian Yu passengers and carriers, but also indirectly contributes to regional economies, the efforts benefit the ct ofindustry flight delays China was Ұ delay 350.71control. billion 2013, stressing delays 107.13 billion in in 2013. The operating surplus of the air transport sector was assessed as air as a on result ofwere flight The final results 1,2, Jian Yu 2,*, Sang-Bing Tsai 2,3,* and Jinfu Zhu 1 Yuxiu Chen entire Chinese society. The great investment in flight shared among 1delays
[email protected] delays. Since delay control not only provides direct benefits to delay act of flight on China was Ұ 350.71 billion in 2013, stressing declining by 110.40 billion in 2013. College of Civil Aviation, Nanjing University of Aeronautics andgovernance Astronautics,should Nanjingbe 211106, Jiangsu, (S.-B.T.) various producing sectors. ndirectly tocontrol regional economies, the benefit 1 (Y.C.); China;
[email protected] [email protected](J.Z.) ht delays.contributes Since delay not only provides direct benefitsthe to of University Employee compensation andAviation, depreciation fixed assets two important airline operating costs. Jiangsu, College ofefforts Civil Nanjing of are Aeronautics and Astronautics, Nanjing 211106, ry 2018; Published: 30 January 2018 2 Research Center for Environment and Sustainable Development of the China Civil Aviation, Civil Aviation nvestment in flightThe delay governance should be shared among ndirectly contributes to regional economies, the efforts benefit the China; (Y.C.);delays
[email protected](J.Z.) changes in these two
[email protected] items caused by flight can be calculated as the production of the cost Keywords: flight delay; input–output method; sustainability; indirect impact; China 2,*, Sang-Bing 2,3, 1 2 Research China, Tianjin 300300, China uinvestment Tsai *ofand Jinfu Zhu Center for Environment and Sustainable Development the Chinadata Civilin Aviation, Civil Aviation inUniversity flight delay governance should be shared among costs share and the variation in airlines operating due to delays. Theof financial the Civil and industries that have strong University relationships with theScience and Technology of flight 3 Zhongshan Institute, of Electronic University of China, Tianjin 300300, China China, Zhongshan 528400, Statistical Yearbook (CASY), published by CAAC, issue the income and loss data of airlines, Nanjing University of Aeronautics and Astronautics, Nanjing 211106, Jiangsu, eion, a huge impact onAviation China’s economy. this study, the 3 In Guangdong, China Zhongshan put method; sustainability; indirect impact; ChinaInstitute, University of Electronic Science and Technology of China, Zhongshan 528400, edu.cn (Y.C.);*
[email protected](J.Z.) including the cost structure and business tax fee. Through the 2013 CASY financial data [60], we found were used analyze the indirect economic impacts of Correspondence:
[email protected] (J.Y.);China
[email protected] (S.-B.T.) Guangdong, put method; sustainability; indirect impact; China nvironment and Sustainable Development of the China Civil Aviation, Civil Aviation that human costs accounted for 6.96% of the airline operating costs, asset depreciation accounted for constructed simultaneous demand-fare equations
[email protected] (J.Y.);
[email protected] * Correspondence: (S.-B.T.) 1. Received: Introduction Tianjin 300300, China 22 November 2017; Accepted: 24 January 2018; Published: 30 January 2018 8.96%. Then, the employee and depreciation of fixed assets were estimated to increase ry as a result of flight delay control. The final compensation results Received: November 2017; 24 January 2018; Published: January University of Electronic and Technology of22 China, Zhongshan 528400, Since theScience late 2000s, flight delay has become anAccepted: increasingly serious problem and30has been2018 t delays on Abstract: China was Ұ 17.05 350.71 billion in 2013, stressing byDue billion. to the influence on the sectors and industries that have strong relationships with the spreading in China. Flight on-time performance decreased to 68.33% in 2015 from 81.48% in 2006, Since delay control not only provides direct benefits tothe Business taxAbstract: is the net taxto on production that issectors mainly influenced by flight delays of with the air transportation industry, flight delays have a huge impact on China’s economy. In this study, the because
[email protected] (J.Y.);
[email protected] (S.-B.T.) Due influence on the and industries that have strong relationships according the Civil Aviation Administration of China ay has become an to increasingly serious problem and has been (CAAC) reports [1]. FlightStats’s June 2015 ontributes to regional economies, the efforts benefit the the variation in airline income [61], which can calculated as the production of theof average input–output method and thetransportation Ghosh model were used tobe analyze the indirect economic air industry, flight have a huge impact China’s economy.airline In this study, the 2017;has Accepted: 24 January 2018; Published: 30problem January 2018 report also ranked China Eastern Airlines and China asdelays the last two carriers out on ofimpacts 50 main decreased to 68.33% in 2015 from 81.48% inAir 2006, lay become an increasingly serious and has been tperformance in flight delay governance should be shared among business tax rate input–output and the variation in airline revenue caused by flight delay. Through the 2013 CASY flight delays on China’s economy. We also constructed simultaneous demand-fare equations to method and the Ghosh were used to analyze thehas indirect economic impacts of international airlines in terms offrom on-time performance [2]. model The resulting inconvenience ministration of decreased China (CAAC) reports June 2015 performance to 68.33% in [1]. 2015FlightStats’s 81.48% in 2006, financial data [60], we found business tax accounted for 0.68% of the airline operating revenue. Then, estimate the direct output of the air industry as a result of flight delay control. The final results flight delays on China’s economy. We also constructed simultaneous demand-fare equations to nfluence on the sectors and industries that have strong relationships with the successfully drawn attention of research institutes, Airlines and Air China as thethe last two[1]. carriers out of June 50 main ministration of China (CAAC) reports FlightStats’s 2015 mass media, and consensus and relevant showed that the total indirect impact of flight delays on China was Ұ 350.71 billion in 2013, stressing the net tax on production was assessed as declining by 0.02 billion. estimate the direct output of the air industry as a result of flight delay control. The final results ustry, flight delays have aas huge impact China’s economy. In this study, thebecause of adverse weather that government departments, particularly after extensive flight delays performance [2]. The resulting inconvenience has Airlines and Air indirect China the last twooncarriers out of 50 main d;on-time sustainability; impact; China the importance of controlling flight delays. Since delay control not only provides direct benefits to showed that the total indirect impact of flight delays on China was Ұ 350.71 billion in 2013, stressing In summary, the value added of the air transport sector in 2013 decreased by 93.37 billion due to the has Ghosh modelmass were used toresulting analyze indirect economic occurred more often China inthe recent years. research institutes, and consensus and relevant ffand on-time performance [2].media, Thein inconvenience has impacts of passengers and carriers, but also indirectly contributes to regional economies, the efforts benefit the the importance of controlling flight delays. Since delay control not only provides direct benefits to delays. Then, with Equation calculated the changes 139 sectors due to flight na’s economy. We flight also constructed simultaneous demand-fare equations to output Flight delays notbecause only disturb airline andwe airport operation, resulting in of considerable rlyresearch after extensive flight delays of adverse weather that of institutes, mass media, and consensus and(4), relevant entire Chinese society. The great investment in flight delay governance should be shared among passengers and control. carriers, but also indirectly contributes to regional economies, the efforts benefit the delays inpassengers, The results are impact shown in Table S1. economy Then, thebecause impact ofthe flight delays on China’s utput ofyears. the air industry as a2013. result of integral flight delay The results inconveniences but negatively the regional of strong recent arly after extensive flightto delays because of also adverse weather that final various producing sectors. entire Chinese society. The great investment in flight delay governance should be shared among indirect impact of flight delays on China was Ұ 350.71 billion in 2013, stressing economy in 2013 totaled billion. interactive relationship between air 350.71 transport and the local economy. Flight delays lead to the urb airline and airport operation, resulting in considerable n recent years. various producing sectors. ntrolling flight delays. Since delay cost control not only provides direct benefits to increase in the purchase of airlines, airports, and other institutions in the air transport industry so negatively impact the regional economy because of the strong urb airline and airport operation, resulting in considerable Keywords: flight delay; input–output method; sustainability; indirect impact; China ecome an increasingly serious problem and economies, has been the 6. Conclusions and Future Research rs, but also indirectly contributes to regional efforts benefit the by other producing sectors. Flight delays also inflate the operating cost of some industries because r transport and the local economy. Flightbecause delays of lead the lso negatively impact the regional economy the to strong Keywords: flight delay; input–output method; sustainability; indirect impact; China nce decreased to 68.33% in 2015 from 81.48% in 2006, y. The great investment in flight delay governance should be shared among the procurement and distribution of the products of these industries heavily depend onWe air transport. nes, airports,and and the other institutions in Flight the air delays transport industry ir transport local economy. lead to the This paper demonstrates how flight delays affect China’s economy. found that flight delays n of China (CAAC) reports [1]. FlightStats’s June 2015 ctors. Forinflate instance, business passenger delay increases administrative costs, leading to an increase in the delays also operating cost of some industries because ines, airports, andthe other institutions in the air transport industry involved indirect nd Air China as the last twonumerous carriers out of 50 costs main on China’s economy, and not only on the airlines and passengers product’s price. This ultimately causes the transaction of related industries to falter. Furthermore, the products of these industries heavily depend on air transport. delays also inflate the operating cost of some industries because as reported by previous studies. Flight delays hamper the development of sectors that considerably 1. Introduction performance [2]. The resulting inconvenience has ay; input–output method; sustainability; impact; China flightadministrative delays may constrain the indirect demands ofair manufacturers other associated industries, such as elay costs, leading to an increase in the thefrom f theincreases products of these industries heavily depend on transport. use or support the ATI. We also constructed fare-passenger simultaneous equations to calculate 1. Introduction institutes, mass media, and consensus and relevant Since the late 2000s, flight delay has become an increasingly serious problem and services, has been tourist services. Consequently, the consumption and requirement of food, accommodation uses transaction of change relatedcosts, industries to falter. Furthermore, elay the increases administrative leading increase in by theflight delays. the in ofto theanATI caused From the signs of the coefficients, we found xtensive flight delays because of revenue adverse weather that spreading in China. Flight on-time performance decreased to 68.33% in 2015 from 81.48% in serious 2006, problem and has been Since the late 2000s, flight delay has become an increasingly retail sales, ground transportation, entertainment, and car rental services will decrease [3]. Combined, mands of manufacturers from other associated industries, such as uses the transaction of delays related industries to falter. Furthermore, that have a positive influence onChina airfare but a negative impact on passenger demand. Hence, ars. according to the Civil Aviation Administration of (CAAC) reports [1]. FlightStats’s June 2015 spreading in China. Flight on-time performance decreased to 68.33% in 2015 from 81.48% in 2006, consumption and requirement ofFOR food, accommodation mands of Sustainability manufacturers from other associated industries,services, such as 2018, 10, x; doi: PEER REVIEW www.mdpi.com/journal/sustainability our findings indicate that flight delays decrease the competiveness of air transport and hinder the June 2015 e and airport operation, resulting in considerable report ranked China Eastern Airlines and Air China as the last two carriers(CAAC) out of reports 50 main according to the Aviation Administration of China [1]. FlightStats’s ntertainment, car rental services will decrease [3].Civil Combined, consumption andalso requirement of food, accommodation services, vely impact the regional economy because of strongofChina sustainable and healthy growth the ATI. The[2]. impacts of flight delays fares demand airlines terms ofthe on-time performance The and resulting inconvenience has report also ranked Eastern Airlines Air China ason theair last twoand carriers out of 50 main 0s, flight international delay has an in increasingly serious problem and has been entertainment, and carbecome rental services will decrease [3]. Combined, IEW www.mdpi.com/journal/sustainability rt and the local economy. Flight delays lead to the also demonstrate that flight delays should not be ignored when managers make decisions about air successfully drawn the attention of research institutes, mass media, and consensus and relevant international airlines in terms of on-time performance [2]. The resulting inconvenience has ight on-time performance decreased to 68.33% in 2015 from 81.48% in 2006, VIEW www.mdpi.com/journal/sustainability rts, and other institutions in the air transport industry fares and estimate the air market demand. Our results are a necessary and useful supplement to the government departments, particularly after extensive flight delays because of adverse weather that successfully drawn the attention of research institutes, mass media, and consensus and relevant Aviation Administration of China (CAAC) reports [1]. FlightStats’s June 2015 o inflate the cost of some industries because assessment of the severity of flight delaysout in China. These also evaluate seriousofimpacts hasoperating occurred more in China recent years. government departments, particularly after results extensive flight delaysthe because adverseof weather that ina Eastern Airlines and Airoften China as the in last two carriers of 50 main ucts of these industries heavily depend on air transport. flight delay control in China from another perspective. Flight delays not only disturb airline and airport operation, resulting in considerable has[2]. occurred more often in China in recent in terms of on-time performance The resulting inconvenience has years. ases administrative costs, to leading to an in the not impact inconveniences passengers, but alsodelays negatively the regional economy becausegenerates of the strong theincrease numerous costs mean flight delay huge profitsinfor Flight only disturb airline and control airport operation, resulting considerable e attention of research Conversely, institutes, mass media, and indirect consensus and relevant ansactioninteractive of related industries to between falter. Furthermore, relationship air transport and the local economy. Flight delays lead to the inconveniences to passengers, but also negatively impact the regional economy because of the strong China’s overall economy. Although airlines and passengers are the direct beneficiaries of minimized nts, particularly after extensive flight delays because of adverse weather that manufacturers frominother associatedcost industries, such as increase the purchase of airlines, airports, and other institutions in the air transport industry interactive relationship between air transport and the local economy. Flight delays lead to the delays, the other producing sectors and the local economy are also important beneficiaries. We n in China in recent years. on and requirement of food, accommodation services, by other producing sectors. Flight delays also inflate the operating cost of some industries because increase in the purchase cost of airlines, airports, and other institutions in the air transport subsequently inferred it is the resulting duty of the operating entities and policymakers to perform flight industry t only disturb airline and airport operation, inATI considerable ent, and car rental services will decrease [3]. Combined, the procurement and distribution of the products of these industries heavily depend on air transport. by regional other Flight also inflate the operating cost of some industries engers, but also negatively impactThis the economysectors. because of thedelays strong delay control. meansproducing considerable investment in flight delay control should be shared among the because business passenger delay increases administrative costs, leading to an increase in the the procurement and distribution of the products of these industries heavily depend on air transport. www.mdpi.com/journal/sustainability p betweenFor airinstance, transport and the local economy. Flight delays lead to the ATI, other producing sectors, and local governments, especially in the cities where busy hub airports product’s price. This ultimately causes the transaction of related industries to falter. Furthermore, For instance, business passenger delay increases administrative costs, leading to an increase in the se cost of airlines, airports, and other institutions in the air transport industry are located. flight delays may constrain the demands of manufacturers from other associated industries, such as product’s price. This ultimately causes the transaction of related industries to falter. Furthermore, ctors. Flight delays also Compared inflate the operating costChinese of somestudies, industries to previous webecause expanded the flight delay time frame by using the Consequently, consumption andonrequirement of accommodation services, flight the delays may depend constrain the demands offood, manufacturers from other associated industries, such as istributiontourist of the services. products of these industries heavily air transport. concept of optimal flight time. Our flight delay not only included the delay that occurs when the retail sales, ground transportation, entertainment, and car rental services will decrease [3]. Combined, tourist costs, services. Consequently, the consumption and requirement of food, accommodation services, passenger delay increases administrative leading to an increase in the actual arrival time is later than the scheduled arrival time, but also the scheduled arrival time that is retail sales, ground transportation, entertainment, and car rental services will decrease [3]. Combined, ultimately Sustainability causes the transaction of related industries to falter. Furthermore, 2018,than 10, x; doi: PEER REVIEW www.mdpi.com/journal/sustainability later the FOR optimal arrival time as determined by the optimal flight time. This concept helped to train the demands of manufacturersSustainability from other associated industries, such as 2018, 10, x; doi: FOR PEER REVIEW www.mdpi.com/journal/sustainability completely and accurately assess the severity of flight delays in China. quently, the consumption and requirement of food, accommodation services, Only the indirect impacts of flight delays on China’s economy were evaluated in this paper. nsportation, entertainment, and car rental services will decrease [3]. Combined, To appraise the complete delay costs, or estimate the limit of investment in delay control, further FOR PEER REVIEW research must be conducted, www.mdpi.com/journal/sustainability including accurately obtaining airline delay costs, more comprehensive
An Empirical Study on the Indirect Impact of Flight An Empirical Study on the Indirect Impact of Flight Delay on China’s Economy Delay on China’s Economy al Study on the Indirect Impact of Flight hina’s Economy
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passenger loss information, and even evaluating other delay cost perspectives in China’s society and economy, including loss of traffic accidents caused by other transportation modes causing passengers disruption due to serious flight delays. Furthermore, to understand the investment direction and the allotment of capital to each area of flight delay control, the causes of flight delay and their respective delay extent should be analyzed in detail. A large amount of work is required in these fields. Supplementary Materials: The following are available online at www.mdpi.com/2071-1050/10/2/357/s1, Table S1: Output-to-primary-input multipliers of air transport sector and Output changes due to flight delays of 139 sectors in 2013. Acknowledgments: This research described in this paper was fully supported by a grant from the National Social Science Fund of China (No. 13CGL005). We would like to thank Yi Zhang (Institute of International Economics and Trade of CAUC) for helpful advice on modeling. Author Contributions: Yuxiu Chen and Jian Yu wrote the manuscript; Yuxiu Chen and Jian Yu provided the case study and idea; and Yuxiu Chen, Jian Yu, Sang-Bing Tsai and Jinfu Zhu revised the manuscript. Conflicts of Interest: The authors declare no conflict of interest.
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