How does aviation promote (local)
social and economic development?
Bruno Miller
John-Paul Clarke
1st Symposium on the Economic and Social
Value of Air Transportation
April 1st and 2nd, 2004
Main ideas
• Symbiotic and changing relationship
between aviation and society
• Understand the context: socioeconomic,
geographic, technological
• Investments today and options for growth
tomorrow
Context of air transportation
Society & Economy
Personal activities
Aviation attributes
Business activities
Frequency Fare Routes
Travel time Safety Security
other modes
other modes
Air transportation infrastructure
Weather
Environment
Regulation
Air carriers
ATC infr.
Airport infr.
What are the right conditions for
aviation to be effective?
Society & Economy
Personal activities
Aviation attributes
Business activities
Frequency Fare Routes
Travel time Safety Security
other modes
other modes
Air transportation infrastructure
Weather
Environment
Regulation
Air carriers
ATC infr.
Airport infr.
Costa Rica
•Surface area: 51,000 km2
(size of West Virginia)
•Population: 4 million
•Mountainous terrain,
tropical climate
Caribbean Sea
Pacific Ocean
Aviation development in
Costa Rica
2
1.5
1
0.5
International
2000
1994
1988
1982
1976
1970
1964
1958
0
1952
Air passengers (million)
2.5
Domes tic
Sources: Alvarez, Castro, Fonseca, DGAC, Jiménez, RDSA
Costa Rica, 1963-64
Int’l airport
Second. Airport
Rural airport
Costa Rica, 1967-1968
Int’l airport
Second. Airport
Rural airport
Examples of domestic air cargo
1950’s-1960’s
Beef (export)
Coffee
Grains: rice, beans
Papaya
Coastal traffic
Costa Rica, 1973
Int’l airport
Second. Airport
Rural airport
Costa Rica, 1982-85
Int’l airport
Second. Airport
Rural airport
Costa Rica, 1991
Int’l airport
Second. Airport
Rural airport
Source: ITCR
Aviation in CR before the mid1970s
•
Context:
1.
2.
3.
•
Geographic: many communities far from economic center(s)
Socioeconomic: aviation main transportation link to move
people and goods
Technological: DC-3, C-46, “time-and-heading” navigation
Attributes:
1.
2.
3.
4.
5.
6.
Travel time: much faster by air
Frequency: medium-high
Fares: low (but not subsidized)
Routes: many
Safety: high
Security high
Aviation development in
Costa Rica
2
1.5
1
0.5
International
2000
1994
1988
1982
1976
1970
1964
1958
0
1952
Air passengers (million)
2.5
Domes tic
Sources: Alvarez, Castro, Fonseca, DGAC, Jiménez, RDSA
40
0.35
35
0.3
30
0.25
25
0.2
20
0.15
15
0.1
10
Domestic pax.
2000
1993
1986
1979
0
1972
0
1965
5
1958
0.05
Roads (1,000 km)
0.4
1951
Air passengers (million)
Expansion of the road network
Roads
Sources: Alvarez, DGAC, DGEC, Fernández, Jiménez, MIDEPLAN
Aviation in CR after the mid1970s: paradigm shift
•
Context:
1.
2.
3.
•
Geographic: few communities far from economic center(s)
Socioeconomic: aviation main fast transportation link,
especially for tourism
Technological: Twin Otter, Grand Caravan, GPS
Attributes:
1.
2.
3.
4.
5.
6.
Travel time: much faster by air
Frequency: low
Fares: high
Routes: few
Safety: high
Security high
Local aviation today
Source: Nature Air
Tourism and domestic air
transportation
• Symbiotic relationship:
• Aviation mostly used by foreign tourists
• Aviation provides fast transportation for tourists on
a time budget
• Air transportation helped establish high-end hotels
in remote regions (Osa Peninsula, N. Caribbean)
ÆIncome source for locals
ÆProtection of natural resources (?)
Reduction in travel time
350
Puerto Jiménez
Air passengers/room
300
250
200
150
Golfito
100
50
0
0
2
4
6
8
10
Tim e reduction (hrs)
$0-49
$50-99
$100-149
$150-200
Sources: DGAC, INCAE
Tourism potential
120
Golfito
Air passengers/room
100
80
Palmar
60
40
B. Colorado
Arenal
Jacó
20
0
0
50
100
150
200
Average room fare (US$)
0-49 rms
50-249 rms
250-999 rms
>1000 rms
Sources: DGAC, INCAE
What are the right conditions for
aviation to be effective?
Society & Economy
Personal activities
Aviation attributes
Business activities
Frequency Fare Routes
Travel time Safety Security
other modes
other modes
Air transportation infrastructure
Weather
Environment
Regulation
Air carriers
ATC infr.
Airport infr.
How to develop the aviation
system?
• Ideally, would have enough understanding
of benefits of aviation to compare them
against its costs
• However, many uncertainties exist and the
operating context changes continuously
The good news
• Initial infrastructure need not be
exorbitantly costly
Gravel runway, 800x18m
Twin Otter DHC-6
•Initial cost: ~ $250k
•Maintenance: ~ $3k/year
•Purchase cost: ~ $500k
•Equilibrium point: 6 pax
The good news (2)
• Consider initial investment an option on
future growth:
• Build a small landing field
• If successful, develop it further
• If not successful, abandon it and loose (relatively)
small investment
Summarizing . . .
• Air transportation can be a strong engine of
social and economic growth
• Better understanding and quantification of
benefits and costs essential for effective
aviation development
• Air transportation must be able to react to a
changing context
Thank you
Bruno Miller
brunom@mit.edu
John-Paul Clarke
johnpaul@mit.edu