Effects of enhanced air connectivity on the Kenyan tourism industry and their likely welfare implications

Abstract

This paper investigates the links between air connectivity, tourism benefits and welfare. It improves on the common practice in the literature by demonstrating avenues of tourism expansion and their welfare implications using both a partial and a general equilibrium model. The results of the gravity model show that there is a strong connection between air connectivity factors and incoming passengers. Simulation results of tourism expansion brought about by improved connectivity demonstrate that all household groups experience an improvement in their welfare but with lower impact on low-income agricultural households. The study concludes that formulating policies that address the air connectivity gap in Kenya would benefit the tourism sector and all households if co-ordinated with rural development initiatives.