Air transport and regional economic growth in China

Air transport increased exponentially in China over the last 30 years, but studies on this issue are few. This paper aims to fill in this literature gap. It identifies the key determinants of air transport in the Chinese regions for the period 1995-2006. The empirical results based on an augmented production function indicate that air transport is positively related with economic growth, industrial structure, population density, and openness, but negatively related with ground transportation. The development of air transport, however, varies significantly across regions in terms of growth and competition with ground transport. The competition has become particularly intense in recent years, as high-speed railways have become a formidable challenge to air transport between the short-and mid-range transportation routes.