Analysis of Factors Affecting The Service Demands Of Domestic Air Passengers

Abstract

With the increase in urbanization, air transportation has become the most preferred mode of intercity transportation. In addition to the speed and comfort provided by airplanes, economic factors have become important in terms of service demand, especially for domestic airline passengers. This study investigates the economic factors affecting the demand for domestic air passengers in Türkiye. For this purpose, the number of domestic airline passengers was used as the dependent variable, and inflation, exchange rate, and economic growth were used as independent variables. In the analysis of the study, the short- and long-term relationships between the 2007Q1:2023Q4 quarterly time series and the variables was examined by the ARDL (Autoregressive Distributed Lag) bounds test method. The Granger Causality Analysis researched the causality between the number of domestic air passengers and economic factors. When the results of this study were evaluated, it was determined that economic growth and inflation positively affected the service demand of domestic airline passengers. The findings revealed that inflation is more important in affecting the demand for services. In the short-term forecast, all variables affected the demand for services. Because of the Granger Causality analysis, causality was determined only from domestic air passengers to the exchange rate.