Price sensitivity to tourism activities: looking for determinant factors
AbstractLiterature shows evidence that there is a marked heterogeneity in price responses to tourism products, leading to a great variety of tourist sensitivities to price. It means that the role price plays is complex and, particularly challenging is that its effect is not unambiguous, thereby dismissing the idea that demand for tourism products and tourist activities is always that of ordinary goods. The objective of this article is to identify and explain, as a novelty for the tourism industry, price sensitivities to tourism activities -individual by individual-. The operative formalization follows a Mixed Logit Model to estimate the individual sensitivities to price and then, a regression analysis to detect their determinants. The empirical application finds that motivations -influenced by age- and length of stay -with a non-linear effect- are explanatory factors of the tourists' price sensitivity to activities.
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Bibliographic InfoPaper provided by USI Università della Svizzera italiana in its series Quaderni della facoltà di Scienze economiche dell'Università di Lugano with number 1101.
Length: 15 pages
Date of creation: Jan 2011
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tourism activities; response to prices; market heterogeneity; tourist choice;
Find related papers by JEL classification:
- C25 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions
- L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-02-26 (All new papers)
- NEP-DCM-2011-02-26 (Discrete Choice Models)
- NEP-MKT-2011-02-26 (Marketing)
- NEP-TUR-2011-02-26 (Tourism Economics)
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