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Application of structural equation modelling for estimating airline performance

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  • Jenatabadi, Hashem Salarzadeh
  • Ismail, Noor Azina

Abstract

Structural equation modelling (SEM) is an estimation method that can handle a large number of exogenous and endogenous factors as well as unobserved (latent) variables that are specified as linear combinations of observed (measurement) factors. This paper presents a SEM procedure with latent variables for estimating the financial and non-financial performance in airline companies. The model includes independent, mediator and dependent latent variables. The sample for this research comprises 214 airline companies. The results indicate that the model is capable of estimating performance with respect to the economic situation and it has also been determined that two types of constructs affect performance. One type is the economic situation acting as an initial construct and the other is the internal operation acting as the mediator in the research model.

Suggested Citation

  • Jenatabadi, Hashem Salarzadeh & Ismail, Noor Azina, 2014. "Application of structural equation modelling for estimating airline performance," Journal of Air Transport Management, Elsevier, vol. 40(C), pages 25-33.
    • Handle: RePEc:eee:jaitra:v:40:y:2014:i:c:p:25-33
    DOI: 10.1016/j.jairtraman.2014.05.005
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