Vol 20 No 5 October 2014
Abstract: The paper proposes a resource curse hypothesis approach to analyse the instability of tourism-led growth. Using panel data on China’s 30 provinces over the period 1987–2010, this study examines the direct and indirect effects of tourism on long-term economic growth. Four transmission channels widely held in the resource curse hypothesis are applied in the tourism industry: Dutch disease effect, crowding-out effect, deterioration of institutional quality and volatility of resource trade. The empirical results show that even in the non-tourism-dependent economies there is a possibility that the tourism resource curse will occur in the long term. Tourism resource development tends to reduce economic growth, mainly through crowding out human capital. A tourism boom seems to have a crowding-out effect on industrial production; however, the effect is small and insignificant in the large non-tourism-dependent economies. The physical investment channel is identified as the most important positive transmission channel through which tourism activity exerts more influence on growth.
Abstract: The authors consider a tourism supply chain that consists of a tour operator in the source market and a local operator at the destination. The tour product is composed of predesigned tours and optional tours. Consumers are sensitive to the price and the availability of optional tours, represented as the ratio of optional tours. The authors analyse how the ratio of optional tours to predesigned tours affects each player’s equilibrium decisions given three different consumer attitudes towards optional tours. They find that when the channel is coordinated and the ratio of optional tours is sufficiently large, the local operator may reduce commissions. To curb the impacts of lowering commissions, the authors introduce a tax mechanism aimed at optional tours. Numeral examples are provided to illustrate the pricing impacts of optional tours.
Abstract: The authors construct an inter-regional input–output model that combines both national and regional data to isolate the effects of changes in demand by their regional nature using an additive decomposition. The model is used to quantify the backward linkages of the top industries in the Balearic Islands (a European region heavily specializing in tourism) with other industries, both within the region and in the rest of Spain. The results confirm the importance of local industries in terms of backward linkage effects, but also reveal that only 55% of these effects stay in the region, while the rest leak out to the rest of the country due to the extraordinary dependency on supplies created by this specialization.
Abstract: Despite the current international financial crisis, the tourism sector has managed to maintain high levels of activity. Against a backdrop of weak demand and stiff competition, efficiency has come to the fore as a key issue, especially in consolidated markets, such as Spain, where hopes that the sector will lead the way to economic recovery contrast with statements from the Competitiveness Monitor of the World Travel & Tourism Council that Spain is losing its competitiveness. In this article, the two- stage Simar and Wilson procedure is used to estimate the effect of a group of nine environmental factors on robust data envelopment analysis (DEA) estimates which act as a proxy of destination competitiveness for the Spanish autonomous communities (or regions) between 2002 and 2010. A brief discussion in terms of D- and E-attraction and cluster D-attraction is also included. The article contributes to the destination industry literature by adopting an approach that has not hitherto been applied to Spain.
Abstract: This study investigates two main issues: the relationship between advertising expenditure and service quality, and the relationship between price and service quality in the hotel industry. The authors consider an asymmetric-information environment, in which consumers are uncertain about service quality, and address the above issues from a signalling perspective. Building on signalling and counter-signalling theory in economics, the authors propose a number of testable hypotheses and conduct an empirical study using data for Taiwanese international tourist hotels. The empirical results support the hypothesis that the advertising–quality relationship is inverted-U shaped, whereas the price–quality relationship is positive and monotonic. Hence, higher prices may signal higher service quality, whereas higher advertising expenditure does not necessarily signal higher service quality.
Abstract: Franchising in the hospitality industry, particularly in the lodging business, has been an extensively studied topic. Yet the answers to critical questions have eluded researchers and practitioners: is franchising in the lodging industry profitable and a value-creating strategy? Moreover, what is the optimal proportion of franchising to attain certain financial outcomes? This study evaluates franchising in the lodging industry, and poses two key financial questions. Are franchised lodging firms more profitable and value-generating than non-franchised operations? And what is the optimal proportion of franchised and non-franchised units for a lodging firm to maximize its financial performance and value creation? The results of the two-way, random-effect regression model suggest that franchised lodging firms are more profitable than non-franchised firms. The study also finds that franchised firms create more intangible value than non-franchised firms. In addition, the authors identify optimal proportions of franchised and non-franchised properties that allow lodging firms to maximize profitability and intangible value. The results provide a critical perspective on the discussion of whether or not lodging firms should franchise and, if so, to what extent.
Abstract: Farm-based recreation, or agritourism, is growing in the USA, raising new interest in the potential benefits for consumers/travellers and communities. This study utilizes a hurdle travel cost model to investigate the demand for and economic benefits of agritourism. The analysis includes an estimation of consumer surplus as one means to estimate the market size for this sector. The standard travel cost model assumes a single-purpose recreational trip; but, as is the case with a number of categories of tourism, this assumption may not hold for all agritourism outings as travellers often visit other destinations. This paper analyses and compares four different models, each using different methods to distinguish between multiple-destination and primary-purpose trips. The findings reveal that consumer surplus ranges from $93 to $164 per person per trip for primary purpose travellers. Implications for accurately estimating the market size of agritourism, as well as a broader set of recreational sectors, are discussed.
Abstract: A two-step decision travel cost model is used to estimate the demand for sportfishing and to measure the effect of fishing tournaments on anglers’ willingness-to-pay on the Lower Hudson River. The endo-genous opportunity cost of angler travel time is incorporated in the demand function using a latent variable. The latent time value indicator is a count of the unique types of complementary and time-saving goods and services purchased during a fishing trip. Tournament fishing is valued at US$317 per angler per trip, compared to US$73 per angler per trip for other sportfishing.
Abstract: As online travel shopping rapidly increases, consumer responses to travel websites need to be better understood. The authors integrate the perspectives of flow experience and perceived shopping value to explain those consumer responses and incorporate website design characteristics into their model. Data were collected from consumers with browsing or purchasing experiences on Taiwan’s travel websites. The results show that website attractiveness and interactivity have a positive influence on flow experience. Website reliability positively affects utilitarian value, whereas ease of use has no significant effect. Flow experience is positively associated with utilitarian value and consumer attitude towards the website; conversely, purchase intention from the website is not affected by flow experience. Furthermore, the findings reveal that perceived utilitarian value positively and significantly influences consumer attitude towards the website and purchase intention. These findings have both theoretical and practical implications.
Abstract: The changes introduced by the Internet to travel agencies (TAs) and tour operators have been investigated for the last 15 years. Researchers have focused mainly on disintermediation and re- intermediation processes fostered by the Web and on their implications for the organization of agencies and sales management. However, the hypothesis that Internet diffusion may have a negative impact on the consistency of the travel agency sector still needs to be proven. Moving on from an analysis of the Italian situation, this study first attempts to reconstruct the ongoing trends at industry level in other European countries. It then explores the relationship between online travel purchases and TAs’ total frequency. The evidence gathered shows a significant degree of correlation between the two variables, suggesting that the growth of the online travel market can effectively prove to be a reduction of existing TAs.
Abstract: The authors explore the extent to which tourism contributed to the economic growth of the different Spanish provinces and autonomous communities in the period 1999–2008. The results obtained by panel data analysis show that the elasticity of the provincial productivity with respect to tourism is equal to 0.10 when overnight stays of foreign tourists are taken as the indicator of provincial tourism, and 0.11 when total overnight stays are taken as the indicator. The results also show that the elasticity of the productivity of the autonomous communities with respect to tourism is slightly lower than the elasticity of the provincial productivity.
Abstract: This article studies the economic value and roles of rural festivals. The authors investigate the festivals of ‘Kuruma-ichi’ and ‘Suisha-matsuri’ in the Yamane area of Kuji city, Iwate prefecture, Japan. They estimate a travel demand model to infer the value of these festivals for visitors and apply the chi-square automatic interaction detection (CHAID) method to analyse the reasons for visiting. The results indicate that the consumer surplus of these festivals is ¥3,627 (US$45.3) for a tourist per trip. From the CHAID analysis it follows that the annual frequency of visits depends on the opportunity for exchange among tourists and the local residents. It appears that the festivals are important occasions for the gathering of former residents in this depopulated and aged mountainous area.
Abstract: Passengers disembarking from cruise ships at ports of call have significant economic effects on the host destination. This paper studies the determinants of cruise passengers’ spending while visiting two ports in Uruguay. Data from an official survey are used to investigate the likely determinants of expenditure in the 2011–2012 cruise season. The Heckit model suggests the presence of a decision process of purchasing that might be more ‘instinctive’ than is suggested by the findings of other papers for general tourism expenditure. The improvement of the economic effects of a cruise requires the formulation of appropriate marketing strategies according to the nationality of passengers. In addition, several findings indicate that such enhancement is more required in the port of Punta del Este, whose logistics do not facilitate the direct disembarkation of tourists to the port.
Abstract: This study examines cruise passenger demand for hotel accommodation in Charleston, South Carolina, prior to embarkation and after debarkation. The findings reveal that cruise passengers are significant drivers of room night demand around embarkation and debarkation. In addition, cruise passenger demand for room nights was not isolated to non-tourist districts of the greater metropolitan area, suggesting that a cruise from Charleston was coupled with a short vacation. This research is particularly important to destination managers, port authorities, municipalities and other stakeholders as they examine and negotiate the frequency, type and timing of passenger cruise service that provides the most positive benefit for the community.