Aviation and externalities: the accomplishments and problems

Abstract Civil aviation has become a major industry and is one of the fastest growing sectors of the world economy. The growth of civil aviation has advantages and disadvantages for the society. The advantages include the direct and indirect generation of new jobs within and around the sector as well as providing a strong stimulus to the globalisation of the industry, business and long distance tourism. Disadvantages include its negative impacts on the environment. This paper presents an overview of the impacts of civil aviation on the environment. In particular, it considers some of the important technological and institutional innovations, that have been implemented in the sector over time in order to simultaneously increase its efficiency and decrease the negative impacts on the environment. Thus, it illustrates how a `sustainable' development of the sector is attempted to be achieved through management of the system's noise, air pollution and safety side effects.

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