SMART Study Reveals Strategic Flight Connections Key to Attracting Global Business and Investment

• Most comprehensive study to date linking global air connectivity and multinational investment, covering 7.5 million firms and 400,000 flight routes over 30 years

• Beyond evaluating number of direct connections, the researchers' new methodology – measuring pairwise connectivity, and degree, betweenness and eigenvector centrality – identifies the deeper network factors that shape global investment

• Knowledge-intensive sectors such as finance, technology and professional services are especially sensitive to the quality of a city’s global air links

Singapore, 23 January 2026: A new study by the Singapore-MIT Alliance for Research and Technology’s (SMART) Mens, Manus & Machina (M3S) interdisciplinary research group, alongside collaborators from Massachusetts Institute of Technology (MIT) and National University of Singapore (NUS), has identified a strong statistical association between global air connectivity and patterns of where multinational corporations (MNCs) invest and set up subsidiaries. This is the most comprehensive global study merging 7.5 million firm records with 30 years of international flight data across more than 800 cities in 142 countries.

Illustrative snapshot of global air network as of 2019 and top hubs by eigenvector centrality. Nodes represent airport cities and links denote direct flight routes, while node size and colour highlight the most central cities as measured by eigenvector centrality. The right panel ranks the top 20 cities. 2019 data is shown here as it represents normal operating conditions, and key findings remain consistent over three decades. (Photo: SMART M3S)

The study’s significance lies in its unprecedented scale and its new methodology, which goes beyond evaluating the number of direct routes. Previous studies typically examined a small set of large global cities, specific regions or domestic flights, and often covered only short time periods. Additionally, the effect of air connectivity on a city’s attractiveness is often only assessed using local connectivity measures, such as total passenger flows or the number of direct flights to other cities. However, this overlooks the topological configuration of the global air transportation network and the influence of indirectly connected airport cities.

“Rigorous and data-driven research around connectivity is essential to understanding the forces that shape our cities and economies and to uncover the hidden infrastructure that enables global businesses. As cities become more interconnected and strive to evolve into global hubs, insights from large-scale, interdisciplinary research such as this will be critical to guiding sustainable growth,” said Fabio Duarte, Principal Investigator at M3S, associate director of MIT’s Senseable City Lab and co-corresponding author of the paper.

A new lens on a city’s economic competitiveness

The study, titled “Air Connectivity Boosts Urban Attractiveness for Global Firms” and recently published in Nature Cities, adopted a broader methodological approach. Analysing an unprecedented dataset allowed them to observe how improvements in air travel networks influence the expansion of MNCs into new cities.

The research combines firm-level records from the Orbis database with international flight data from the International Civil Aviation Organisation over three decades, from 1993 to 2023.

The study first evaluated pairwise connectivity — the number of direct and indirect flights between the cities in which parent companies and their subsidiaries are located. Then, to evaluate global connectivity, the researchers analysed patterns in the air travel network using network-based centrality measures – including degree (number of direct flight connections), closeness (how easily a city can reach others with minimal layovers), betweenness (how often a city acts as a transfer point between other cities) and eigenvector (a city’s flight routes and the connectedness of its linked destinations) centrality. The study found that pairwise connectivity, alongside degree, betweenness and eigenvector centrality, play a significant role in shaping where multinational corporations establish subsidiaries.

Key findings

Fewer layovers meant more subsidiaries: The study provided strong empirical evidence that air traffic connectivity is a critical coordination infrastructure for multinational corporations, showing a clear correlation between flight convenience and foreign investment. Even one layover is associated with an average of 20% fewer subsidiaries being established, and this rises to 34% with two or more layovers.

Quality of flight connections matters most: A city’s eigenvector centrality – capturing not only a city’s own flight routes but also its indirect connections through its destinations, reflecting its embeddedness in the global air network – was found to be the strongest predictor of how many foreign subsidiaries it attracted. Cities with flight connections to influential global flight hubs consistently outperform those with more flight connections but to less-connected destinations – a 10% increase in eigenvector centrality is associated with nearly a 1% increase in the number of foreign subsidiaries.

Knowledge-intensive sectors rely on connectivity: The impact of air connectivity is especially pronounced in industries that depend on frequent face-to-face interaction, including finance, consulting, technology and other knowledge-based services. For these sectors, direct flights and strong global connections are especially important for attracting investment, while the effect is much weaker for others such as manufacturing and retail.

Singapore among highly connected cities

Singapore hosts roughly 6,000 large- and medium-sized foreign-owned subsidiaries with a minimum annual revenue of US$5million – the highest number for any city. In the connectivity metrics studied, Singapore scores highly on eigenvector centrality – alongside other cities such as London, Paris, Hong Kong, Dubai and Tokyo – reflecting its strategic links to other well-connected airports. These patterns suggest that global connectivity is a contributing factor – among other unobserved factors – that may shape where multinational firms choose to locate.

Global distribution of MNC’s subsidiaries in 2023. Each dot represents an airport city, with colour shading indicating the number of subsidiaries of foreign MNCs in 2023 (red represents the highest number). The right panel ranks the top 20 cities by subsidiary count. (Photo: SMART M3S)

“By looking beyond simple counts of routes and examining how cities are embedded in the wider air network, our study reveals the deeper structural factors that shape multinational expansion. It demonstrates that firms respond not only to a city’s direct access, but also to the strategic advantages conferred by its position within global connectivity,” shared Wen-Chi Liao, Associate Professor of Real Estate and Assistant Dean at the NUS Business School, Visiting Associate Professor at the MIT Center for Real Estate (CRE) and one of the authors of the paper.

Navigating the path to global competitiveness

The practical implications of these findings are significant for policymakers, urban planners and business leaders. Notably, the patterns and findings identified in the study have remained strong throughout the 30-year period, even amidst massive changes in how businesses operate and connect – shaped by shifts such as the internet, rapid digital advances, teleconferencing and digital collaboration tools, and the COVID-19 pandemic. This enduring relationship underscores the importance of maintaining and strengthening strategic air connections to increase a city’s attractiveness to multinational firms and foreign investment.

For Singapore, the research suggests that its continued focus on innovation and strategic planning in aviation has proven to be essential, particularly as global competition intensifies.

“This study highlights important implications for urban planning and economic policy, as air connectivity isn’t just about adding more routes for travel – it’s about sustaining economic vibrancy and being attractive to MNCs. The results are clear – being connected to influential hubs is critical in better overcoming coordination barriers and accelerating business expansion,” said Ambra Amico, Postdoctoral Researcher at M3S and co-corresponding author of the paper.

As global competition and trade frictions intensify, cities that prioritise not just the quantity but the quality of their air network connections will be best positioned to attract foreign investment and drive sustainable economic growth.

“With trade and geopolitical frictions, it’s more and more important to have face-to-face interactions to build trust for global trade and business. You still need to reach an actual place and see your business partners, so cities with good air connectivity really influences how global business copes with global uncertainties,”, said Siqi Zheng, Principal Investigator at M3S, Professor and Faculty Director of MIT Center for Real Estate, and one of the authors of the paper.

The research conducted at SMART was supported by the National Research Foundation Singapore under its Campus for Research Excellence and Technological Enterprise (CREATE) programme.