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Economic Effects of the EU External Aviation Policy

Economic Effects of the EU External Aviation Policy
©EU
Abstract: 
This report investigates the economic effects of EU’s external aviation policy with third countries. In particular, focusing on 27 countries with which the EU has an Air Services Agreement (ASA) of varying degree of liberalization, we assessed changes in fare, flight frequency and capacity utilization. We find that the implementation of the EU external aviation policy results in lower fare levels and higher load factors (capacity utilization). The effect of the policy on frequency, however, is not statistically significant. Our findings suggest that further liberalization can lead to more benefits to consumers.