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Economic Contribution to Hong Kong of the Aviation Sector: A Value-Added Approach

Author

Listed:
  • Michael Ka-Yiu Fung
  • Japhet Sebastian Law
  • Louise Wing-Kam Ng

Abstract

The emergence of air transport has greatly facilitated long-distance travel and the exchange of goods. The industry also contributes substantially to the economy. Our study measures the benefits that the aviation industry has brought to the Hong Kong economy using the value-added (VA) approach. We find that air transport itself and services that are incidental to the sector (direct benefits) contributed about 2.54 percent of gross domestic product (GDP) at factor cost (at current prices) in 2003, while trade services and the tourism industry (indirect benefits) contributed 4.48 percent. Hence, the total benefit brought by the aviation industry was 7.02 percent of GDP at factor cost (at current prices) in 2003. This demonstrates that the industry is a major component of the Hong Kong economy, and our findings should aid in understanding the effects of recent changes in aviation policies, which have altered the business environment of the aviation market.

Suggested Citation

  • Michael Ka-Yiu Fung & Japhet Sebastian Law & Louise Wing-Kam Ng, 2006. "Economic Contribution to Hong Kong of the Aviation Sector: A Value-Added Approach," Chinese Economy, Taylor & Francis Journals, vol. 39(6), pages 19-38, December.
    • Handle: RePEc:mes:chinec:v:39:y:2006:i:6:p:19-38
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    Cited by:

    1. Tsui, Wai Hong Kan & Fu, Xiaowen & Yin, Chuanzhong & Zhang, Huaxin, 2021. "Hong Kong's aviation and tourism growth - An empirical investigation," Journal of Air Transport Management, Elsevier, vol. 93(C).
    2. Chuntao Wu & Maozhu Liao & Chengliang Liu, 2019. "Acquiring and Geo-Visualizing Aviation Carbon Footprint among Urban Agglomerations in China," Sustainability, MDPI, vol. 11(17), pages 1-16, August.
    3. Tsui, Wai Hong Kan & Fung, Michael Ka Yiu, 2016. "Analysing passenger network changes: The case of Hong Kong," Journal of Air Transport Management, Elsevier, vol. 50(C), pages 1-11.
    4. Arora, Swapan Deep & Mathur, Sameer, 2020. "Effect of airline choice and temporality on flight delays," Journal of Air Transport Management, Elsevier, vol. 86(C).
    5. Zhao, Bing & Wu, Hao & Wang, Nuo, 2022. "Changing characteristics of the industrial correlation and economic contribution of air transport in China: An input–output analysis," Journal of Air Transport Management, Elsevier, vol. 104(C).
    6. Dube, Kaitano & Nhamo, Godwell & Chikodzi, David, 2021. "COVID-19 pandemic and prospects for recovery of the global aviation industry," Journal of Air Transport Management, Elsevier, vol. 92(C).
    7. Yuxiu Chen & Jian Yu & Li Li & Linlin Li & Long Li & Jie Zhou & Sang-Bing Tsai & Quan Chen, 2018. "An Empirical Study of the Impact of the Air Transportation Industry Energy Conservation and Emission Reduction Projects on the Local Economy in China," IJERPH, MDPI, vol. 15(4), pages 1-20, April.
    8. Yuan, Xue-Ming & Low, Joyce M.W. & Ching Tang, Loon, 2010. "Roles of the airport and logistics services on the economic outcomes of an air cargo supply chain," International Journal of Production Economics, Elsevier, vol. 127(2), pages 215-225, October.
    9. Yuen, Andrew & Zhang, Anming & Hui, Yer Van & Leung, Lawrence C. & Fung, Michael, 2017. "Is developing air cargo airports in the hinterland the way of the future?," Journal of Air Transport Management, Elsevier, vol. 61(C), pages 15-25.

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