Intermediaries as Bundlers, Traders and Quality Assessors: The Case of UK Tour Operators
AbstractWe study the intermediary role of tour operators in the market for package tourism. Intermediaries often arise in order to facilitate trade in markets characterized by asymmetric information. In the travel industry policy-makers have tried to address information asymmetries by providing hotel ratings. We argue that those ratings are not accurate indicators of quality. Ratings provided by tour operators are more informative and allow for international comparisons. Intermediation by tour operators provides a better matching of quality with price and therefore leads to a more efficient market outcome. There is, nonetheless, scope for government intervention to improve information provision.
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Bibliographic InfoPaper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 5038.
Date of creation: May 2005
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Find related papers by JEL classification:
- L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
- L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-06-14 (All new papers)
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