VECTOR AUTOREGRESSION AND VECTOR ERROR CORRECTION MODELS: APPLICATION TO ETHIOPIAN AIR LINE DATA
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Received : January 10, 2018; Revised April 27, 2018
Ethiopian Airline is playing a leading role in transforming
The present article has utilized a monthly data from January 2009 up to December 2013 to build vector autoregression (VAR) and VECM models, and also to know the effect of a study target variable Load Factor (LF) to Passenger Revenue (PR), Block Hours (BH), and Distance Flown (DF) at international level.
The VECM (1) shown that the Load Factor (as a measure of travel demand) is Granger caused by all variables in the short-run except Passenger Revenue and significantly explained by all variables in the long-run.
load factor, vector autoregression (VAR), cointegration, vector error correction model (VECM), forecasting.