How Regional Airport Performance Affects Labor Market in Ukraine

Air transportation is a core element of the logistic system for social and business purposes. The development of the national airport infrastructure is the predeterminant of the aviation success. During 2010 – 2018 years, the aviation sector in Ukraine expand in terms of air passenger traffic. Nevertheless, the increasing passenger traffic distributed disproportionately among regions. Thus, different regions experiencing different effect of the regional airport performance. In this work, we want to estimate the effect of the regional airport performance in terms of air passenger traffic on regional labor market, in terms of wage in various economic sectors, in Ukraine. The results show that airport performance affect wages in such sectors: Trade, Agriculture Industry, Information & Technology and Professional services. Moreover, the estimated effect varies across region regardless to the development of the regional airport. The estimated results suggest that the effect of airport performance is large for the regions with big airports, and, surprisingly, for small regions, with small airports the increase passenger flow from 2017-2018 years provides even larger effect on wages in Trade, Agriculture and Industry sectors.