Untangle air connectivity and tourism development in China’s domestic market

This paper examines how domestic air connectivity shapes spatial patterns of tourism development in China. We construct a Domestic Airport Connectivity Index (DACI) at the city level for 2000–2024 and employ an instrumental variable strategy to address potential endogeneity, using the interaction between high-speed rail (HSR) expansion and proximity to hub airports as an instrument. The 2SLS estimates indicate that a one-standard-deviation increase in DACI is associated with a 31.2% increase in tourist arrivals and a 48.8% increase in tourism revenue, corresponding to approximately 8.1 million additional tourists and 2 billion USD in additional revenue per city-year. The larger response in tourism revenue suggests that stronger air connectivity is particularly associated with higher-value tourism demand. These findings also indicate that aviation remains an important component of China’s domestic transport system despite the extensive development of HSR. This study contributes to literature on air transport and tourism interactions by i) introducing a network-based measure of domestic air connectivity, and ii) using HSR-induced variation in the aviation network to address the endogeneity between air connectivity and tourism demand.