Border effects in European air passenger transport

In a highly integrated Europe where freedom of movement is guaranteed by law, national borders should not pose any barriers to transportation. However, evidence suggests otherwise. National borders still appear to impede passenger transport. This paper aims to estimate the magnitude of border effects and their determinants within the context of European air passenger transport. A gravity model incorporating a unique combination of determinants of both air transport and border effects is estimated. The results indicate that cross-border routes are associated with a 74.3% decrease in seat capacity and a 72.2% decrease in total frequency relative to comparable domestic routes. Border effects are reduced between countries that share a language and between countries that experience significant migration flows. Furthermore, based on a country-pair analysis, we found that borders in Western Europe act as lower barriers than those in Central-Eastern Europe.