Measuring the Relationship Between Airline Network Connectivity and Productivity

This paper investigates the relationship between differing measures of airline network connectivity and changes in multifactor productivity (MFP) using data for the United States. It was found that how an airport is connected into the airline network does affect MFP and that the connectivity measures that best explain the effect on MFP vary by industry. The principal finding of the research is that connectivity does appear to affect productivity, but how the connectivity is achieved, whether by more flights, more destinations, or more capacity, varies in importance across industries.