Air transportation and economic growth in Egypt using ARDL approach

Abstract EN

Development of air transportation sector is of crucial importance for stimulation of “economic growth”.

Most of international freight in Egypt relies on maritime transportation, which requires further study of air transportation in the Egyptian economy.

The paper analyzes short-run and long-run dynamics among studied variables on annual basis from 1970 till 2019 to investigate the relationship between “economic growth” and air transportation.

The paper derived economic hypotheses using logical deduction, then empirical testing through econometric methods deploying ARDL “Autoregressive Distributed Lag” technique based on specification and model examination, estimating three models; first model main hypothesis that air transportation accelerates “economic growth” estimation found positive statistical significance of infrastructure and air passengers on “economic growth”, and insignificance of air freight, second model main hypothesis “economic growth” accelerates air passenger which found to be statistically positive significant, third model main hypothesis that “economic growth” accelerates air freight which found to be insignificant.

The study recommends further investment in air transportation to enhance economic growth.