Comments on: Someone help me, I’m “addicted” to air travel! http://welkerswikinomics.com/blog/2007/09/11/someone-help-me-im-addicted-to-air-travel/ for students and teachers of Economics Tue, 22 May 2012 23:46:08 +0000 hourly 1 http://wordpress.org/?v=3.3.2 By: Sakkti http://welkerswikinomics.com/blog/2007/09/11/someone-help-me-im-addicted-to-air-travel/comment-page-1/#comment-8629 Sakkti Sat, 24 Oct 2009 23:42:41 +0000 http://welkerswikinomics.com/blog/2007/09/11/someone-help-me-im-addicted-to-air-travel/#comment-8629 I don’t think that air travel has a PED of zero because this would mean that a change in price would have no effect on the quantity demanded. If the price of air travel would increase by 70% then I am very certain that the demand would decrease drastically, since most travelers will not be able to afford the travel. However, there are not a lot of substitutes for airplanes. Could you imagine people travelling with a boat for holiday? That is quite bizarre. A change in price of air travel will have different effects on people who are travelling for leisure and for people who are travelling for business. The PED for air travel for business purposes might be very close to zero (inelastic), since it is their job to go attend that specific conference or meeting. They cannot afford to miss it. As a result, different buyers will respond differently to the price changes. Air travel could be considered as a luxury good, since it is not a necessity. However, this might not apply for business travel, since it is a necessity to keep the job and it is not considered as a luxury good. I don’t think that air travel has a PED of zero because this would mean that a change in price would have no effect on the quantity demanded. If the price of air travel would increase by 70% then I am very certain that the demand would decrease drastically, since most travelers will not be able to afford the travel. However, there are not a lot of substitutes for airplanes. Could you imagine people travelling with a boat for holiday? That is quite bizarre.

A change in price of air travel will have different effects on people who are travelling for leisure and for people who are travelling for business. The PED for air travel for business purposes might be very close to zero (inelastic), since it is their job to go attend that specific conference or meeting. They cannot afford to miss it. As a result, different buyers will respond differently to the price changes. Air travel could be considered as a luxury good, since it is not a necessity. However, this might not apply for business travel, since it is a necessity to keep the job and it is not considered as a luxury good.

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]]> By: serenatu http://welkerswikinomics.com/blog/2007/09/11/someone-help-me-im-addicted-to-air-travel/comment-page-1/#comment-2729 serenatu Tue, 18 Sep 2007 23:56:30 +0000 http://welkerswikinomics.com/blog/2007/09/11/someone-help-me-im-addicted-to-air-travel/#comment-2729 Not only family goes on family trips for vacations, but most of the time what i saw is that business people go on trips more often. A price increase in the short run could be inelastic, because those business people can't just be like oh the price of the tickets gotten higher, I'm not going to attend the meeting in China, they would probably get fired. So in the short run they have to accept the price change. But in the long run, they would have more time to make reponse, so the PED will be more elastic. If the geographer's statement is true, then the airline can keep on raising the price and peopel won't mind it. So basically he's saying that airlines are monopolies, which i don't think it's true. Most people will stop going to the airlines when the price is getting higher. Not only family goes on family trips for vacations, but most of the time what i saw is that business people go on trips more often. A price increase in the short run could be inelastic, because those business people can't just be like oh the price of the tickets gotten higher, I'm not going to attend the

meeting in China, they would probably get fired. So in the short run they have to accept the price change. But in the long run, they would have more time to make reponse, so the PED will be more elastic.

If the geographer's statement is true, then the airline can keep on raising the price and peopel won't mind it. So basically he's saying that airlines are monopolies, which i don't think it's true. Most people will stop going to the airlines when the price is getting higher.

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]]> By: Evan http://welkerswikinomics.com/blog/2007/09/11/someone-help-me-im-addicted-to-air-travel/comment-page-1/#comment-2703 Evan Sun, 16 Sep 2007 13:04:21 +0000 http://welkerswikinomics.com/blog/2007/09/11/someone-help-me-im-addicted-to-air-travel/#comment-2703 People who are used to traveling around the world in airplanes has become very ingraned in our life style. We can't even go 6 months (most of us) without hopping on a plane. But are we bad people? I don't think so. Tim Sun is a shining example of that. We live far from our family and homes in our home country, and taking a boat simply is silly. We don't have to stop taking airplanes but we can be constructive with our choices. Go Bowing :) People who are used to traveling around the world in airplanes has become very ingraned in our life style. We can't even go 6 months (most of us) without hopping on a plane. But are we bad people? I don't think so. Tim Sun is a shining example of that.

We live far from our family and homes in our home country, and taking a boat simply is silly.

We don't have to stop taking airplanes but we can be constructive with our choices.

Go Bowing :)

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]]> By: kxc.024 http://welkerswikinomics.com/blog/2007/09/11/someone-help-me-im-addicted-to-air-travel/comment-page-1/#comment-2678 kxc.024 Wed, 12 Sep 2007 23:25:18 +0000 http://welkerswikinomics.com/blog/2007/09/11/someone-help-me-im-addicted-to-air-travel/#comment-2678 Even though traveling by air is very popular amont people - especially the middle and upper class when they take vacations and business trips - I don't believe that the PED of air travel is zero. It is impossible that if the government raised the taxes on plane tickets that everyone would still go on their vacations. If it was raised by only a little, then I don't think it'll make much of a difference. But if a large tax was placed on it, I'm sure middle class people would find some other ways to go about their ways, such as with boats and cars. The implication of this for consumers is that, unless they are willing to pay a lot more for their traveling fees, they will have to resort to using other methods of transportation. This means that they can only travel to closer places (for example, British people won't be able to go to America, unless they don't mind a week's worth of boat rides), and their activities are limited as well. For the airlines, new complications such as a decrease in consumers may occur (unless the PED is zero, which is unlikely). Although I personally don't think that air travel is perfectly inelastic, I can see why it could be. In a world where everything is developing so fast, there are more things to see but not enough hours in a day. People are also busy and with increasing incomes, we try to find ways that are most efficient for long distance traveling, which is by airplane. Even though traveling by air is very popular amont people – especially the middle and upper class when they take vacations and business trips – I don't believe that the PED of air travel is zero. It is impossible that if the government raised the taxes on plane tickets that everyone would still go on their vacations. If it was raised by only a little, then I don't think it'll make much of a difference. But if a large tax was placed on it, I'm sure middle class people would find some other ways to go about their ways, such as with boats and cars.

The implication of this for consumers is that, unless they are willing to pay a lot more for their traveling fees, they will have to resort to using other methods of transportation. This means that they can only travel to closer places (for example, British people won't be able to go to America, unless they don't mind a week's worth of boat rides), and their activities are limited as well. For the airlines, new complications such as a decrease in consumers may occur (unless the PED is zero, which is unlikely).

Although I personally don't think that air travel is perfectly inelastic, I can see why it could be. In a world where everything is developing so fast, there are more things to see but not enough hours in a day. People are also busy and with increasing incomes, we try to find ways that are most efficient for long distance traveling, which is by airplane.

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