Quality-of-Service Model of Intercity Air-Travel Demand

Abstract

An econometric model is estimated for intercity passenger demand using postderegulation data. The model incorporates some quality-of-service measures as explanatory variables. These include flight frequency during peak and off-peak periods, aircraft size (i.e., number of seats), and travel time. The results suggest that demand is elastic with respect to airfare, and is highly dependent on flight schedule and travel time. It seems that frequency and route planning will continue to be challenges for the airlines, and that the solutions are very much market specific. They will depend on, among other things, the predominant trip purpose (business or nonbusiness), and the capacity constraints that affect the utilization of specific airports.