Master Plan Update (pdf) - Lansing/Capital City Airport

2.3.2 Econometric and Socioeconomic Regression Analysis
Capital Region Airport Authority
Capital City Airport Master Plan Update
Several local socioeconomic indicators were reviewed and tested to determine if a statistically
significant relationship exists between historical enplanements at Capital City Airport and the
selected indicators for the ASA. The indicators reviewed in this analysis included: population,
employment, per capita personal income (PCPI), and airline yields. Two different scenarios were
examined for the US carriers’ domestic yield. Scenario 1 assumed that the airlines’ yield would
continue to decline based on an extension of the FAA’s yield projections. Scenario 2 assumed that
the airlines’ yield would increase from the recession lowered 2002 level to the pre-recession 2000
level and decline thereafter to 7.5 cents per mile. Historical data and projections of these
socioeconomic indicators were taken from the Woods and Poole 2003 MSA Profile.
The statistical significance of projections produced by a regression analysis is assessed using the
coefficient of determination, or R 2 value. The R 2 value is the square of the correlation coefficient
and measures the contribution of the independent variables in the prediction of the dependent
variable. The R 2 value will range between 0.00 and 1.00 with 1.00 indicating a perfect correlation
between the independent and dependent variables. R 2 values of less than 0.70 generally indicate
there is little correlation between the two variables.
Table 2-13 presents the results of this projection technique for predicting future enplanements at
the Airport. The three socioeconomic independent variables and two yield scenarios were
examined using a single independent variable regression analysis. In addition, a multiple
regression analysis was performed combining the PCPI and Scenario 2 yield independent
variables.
As shown, the R 2 value for all seven regression ranges between 0.77 to 0.86, which indicates a
statistical correlation between the independent and dependent variables.
Independent Variables
Scenario 1 Scenario 2
PCPI and
Scenario 2
Year Population Employment PCPI Domestic Yield Domestic Yield Domestic Yield
Projected Enplanements (Dependent Variable)
2008 387,200 395,400 435,100 361,600 326,000 415,400
2013 435,800 430,700 478,900 375,000 329,500 451,300
2023 545,400 507,300 571,600 399,500 336,400 527,300
R 2 Values 0.791 0.857 0.818 0.769 0.769 0.821
Source: Reynolds, Smith and Hills, Inc.
Table 2-13
REGRESSION ANALYSIS PROJECTION SUMMARY
Aviation Demand Forecast 2-22 Final