Title: Airports, Market Access, and Local Economic Performance: Evidence for China

Speaker: Professor Stephen Gibbons, London School of Economics and Political Science

Time: December 5th, 2016 13:30–15:00 

Venue: Conference Room 106B, Zhonghui Building (College of Economics, JNU)

Abstract:

In this paper we study the effect of airports on local economic performance that arises from better access to domestic markets, using China’s recent rapid air network expansion. We estimate the effects of the implied changes in access to population on measures of economic performance using a panel of counties built from administrative records and micro data on industrial firms. To mitigate endogeneity concerns we focus on a subsample of ‘incidentally’ affected counties, whose location midway between existing and new airports implies they not were explicitly targeted for development nor directly affected by airport operations. We also decompose market access into land-side and air-side components. Our key finding is that improved population access due to land-side distance reductions to airports increased industrial output and GDP.