Empirical estimation of civil aviation demand elasticity: The case of China Mainland

With the high-speed railway of large-scale construction and operation, people have alternative options on the long-distance, short-term demand for passenger transport. Factors affecting civil aviation demand elasticity including civil aviation route characteristics such as distance, civil aviation market structure, number of passengers and so on, end-point city characteristics such as urban population, per capita income level, tourism development level, major social and economic events such as 9.11, 2008 Crisis, etc., in addition to the above-mentioned factors have been explored in foreign countries, the development of domestic high-speed rail passenger transport to the formation of the substitution effect has reached the point cannot be ignored, based on the previous studies, this paper introduces the level of high-speed rail as the new influencing factor into the model of demand elasticity with the parallel line of civil aviation passenger line. The results show that the lower the price, the longer the distance, the higher the level of urban agglomeration, and the absence of financial shocks, the demand greater, meanwhile the higher the level of high-speed rail accessibility, similar to the lower demand for civil aviation passenger routes. This paper discusses the decisive factors of demand elasticity of civil aviation passenger transport in China Mainland under the new traffic situation, and provides strategic suggestions for civil aviation passenger transport pricing.