Causality between economic growth and air transport expansion: Empirical evidence from Chile

This paper analyses the effects in the long-run between air transport demand and the economic growth in Chile for the period 1986 qIII to 2014 qIV. Johansen cointegration analysis shows the existence of one co-integrated vector where the corresponding elasticities are positive. The study shows that the causality relationship is positive and bidirectional. Impulse response analysis shows that an increase in the magnitude of air transport expansion in Chile produces a positive effect on economic growth in the country.