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Economics of tourist's consumption behaviour: Some evidence from Australia

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  • Divisekera, Sarath

Abstract

This study analyses the consumption behaviour of international tourists from Australia's four major source markets: New Zealand, UK, USA and Japan. A preliminary analysis of their consumption expenditures reveals intriguing similarities as well as diversities in consumption patterns. These are sought to understand in terms of the utility-maximising framework in which observed differences in prices and incomes play a key role. Based on the neoclassical economic theory of consumer behaviour, models incorporating five major components of tourist consumption – Accommodation, Food, Transport, Shopping and Entertainment- are estimated. Overall, the level of tourist consumption is found to be highly sensitive to incomes but less sensitive to prices. The low price sensitivity suggests tourists perceive the commodities as necessities and may also reflect their captivity at the destination, masking the underlying true price sensitivities. An important dimension underlying these findings is the possible lack of information about the destination leading to sub-optimal consumption choices.

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  • Divisekera, Sarath, 2010. "Economics of tourist's consumption behaviour: Some evidence from Australia," Tourism Management, Elsevier, vol. 31(5), pages 629-636.
    • Handle: RePEc:eee:touman:v:31:y:2010:i:5:p:629-636
    DOI: 10.1016/j.tourman.2009.07.001
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    Cited by:

    1. Marrocu, Emanuela & Paci, Raffaele & Zara, Andrea, 2015. "Micro-economic determinants of tourist expenditure: A quantile regression approach," Tourism Management, Elsevier, vol. 50(C), pages 13-30.
    2. Helena Nemec Rudez, 2018. "The Relationship between Income and Tourism Demand: Old Findings and New Research," Academica Turistica - Tourism and Innovation Journal, University of Primorska Press, vol. 11(1), pages 67-73.
    3. Jianxiong Tang & Chaoyue Cai & Yujing Liu & Jiaxiang Sun, 2022. "Can Tourism Development Help Improve Urban Liveability? An Examination of the Chinese Case," Sustainability, MDPI, vol. 14(18), pages 1-27, September.
    4. Yuhao Liu & Yunseon Choe, 2023. "Motivation-Based Segmentation of Tourist Shoppers to Hainan During COVID-19," SAGE Open, , vol. 13(3), pages 21582440231, September.
    5. Rafael Robina Ramírez & Manuel Pulido Fernández, 2018. "Religious Travellers’ Improved Attitude towards Nature," Sustainability, MDPI, vol. 10(9), pages 1-23, August.
    6. Wang, Yu Shan, 2014. "Effects of budgetary constraints on international tourism expenditures," Tourism Management, Elsevier, vol. 41(C), pages 9-18.
    7. Saayman, Andrea & Viljoen, Armand & Saayman, Melville, 2018. "Africa’s outbound tourism: An Almost Ideal Demand System perspective," Annals of Tourism Research, Elsevier, vol. 73(C), pages 141-158.
    8. Andrea Pellegrini & Igor Sarman & Rico Maggi, 2021. "Understanding tourists’ expenditure patterns: a stochastic frontier approach within the framework of multiple discrete–continuous choices," Transportation, Springer, vol. 48(2), pages 931-951, April.
    9. Unathi Sonwabile Henama, 2013. "Attracting Indian Outbound Tourists to South Africa: A BRICS Perspective," India Quarterly: A Journal of International Affairs, , vol. 69(3), pages 229-247, September.
    10. Fidel Martínez-Roget & José Alberto Moutela & Xosé A. Rodríguez, 2020. "Length of Stay and Sustainability: Evidence from the Schist Villages Network (SVN) in Portugal," Sustainability, MDPI, vol. 12(10), pages 1-19, May.
    11. Xuemin Liu & Jiaoju Ge & Ting Ren, 2021. "Uncertainty and Tourism Consumption Preferences: Evidence from the Representative Chinese City of Shenzhen," Sustainability, MDPI, vol. 13(8), pages 1-20, April.
    12. Rodríguez, Xosé A. & Martínez-Roget, Fidel & González-Murias, Pilar, 2018. "Length of stay: Evidence from Santiago de Compostela," Annals of Tourism Research, Elsevier, vol. 68(C), pages 9-19.

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