TELECOMMUNICATION AND FUTURE DEMAND FOR AIR TRAVEL

This workshop presentation addresses the topic of the impact of telecommunication on the airline industry. From the economist's point of view, this is a matter of substitution and stimulation. With respect to substitution, the question is whether telecommunication leads people to eliminate or defer trips. Stimulation is the inverse effect: whether telecommunication leads to more face-to-face communication. The discussion focuses on substitution. An examination is made of what segments of the air travel market could be diminished or supplanted by telecommunication. Also considered are changes in the business travel market and changes in the telecommunication industry. In summary, studies indicate that some substitution will occur over the next decade. Estimates range from 2 to 11% penetration of the business air travel market, and virsually none in the pleasure and personal travel market. This would amount to replacement of somewhere between 1 and 4% of all air travel within the next decade. This equivalent to about one year of normal secular growth in passenger enplanements. A substitution of this magnitude is scarcely big enough to notice and well within the error of estimate in most aviation forecasts. If the stimulation effects were taken into account, it could be that the two effects would cancel each other out and that the impact on air travel would be nil.

Language

  • English

Media Info

  • Features: Figures; Tables;
  • Pagination: p. 27-31
  • Serial:

Subject/Index Terms

Filing Info

  • Accession Number: 00721439
  • Record Type: Publication
  • Files: TRIS, TRB
  • Created Date: May 13 1996 12:00AM