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The Operational Efficiencies of the Hotel and Guesthouse Business in Thailand

Author

Listed:
  • Akarapong Untong

    () (Public Policy Studies Institute, Chiang Mai University, Chiang Mai, Thailand)

  • Phanin Khureathai

    () (Faculty of Management Science, Uttaladit Rajabhat University, Uttaradit, Thailand)

  • Mingsarn Kaosa-ard

    () (Public Policy Studies Institute, Chiang Mai University, Chiang Mai, Thailand)

Abstract

This paper aims to assess the operational efficiencies and technology gaps in hotel and guesthouse business in Thailand. The study classified the hotels and guesthouse into five groups with distinctive levels of operational technologies. A meta-frontier analysis is applied to evaluate the efficiency scores of 1,799 samples of hotels and guesthouses in year 2007. It is analyzed within the same groups and between groups. The results show that the international chain or foreign investment hotels had the highest efficiency scores. The mean operation efficiencies in motel group had the lowest efficiency scores. In addition, the empirical results reveal that in case of different operational technologies, using pool frontier and group frontier approaches would provide an over-estimation of the efficiency scores. This study suggests different policies and technologies should be used to improve the operational efficiencies in hotel and guesthouse business. Sharing and transferring the operations knowledge within the group and among the groups would help develop the operational technologies and increase the efficiencies for the whole industry.

Suggested Citation

  • Akarapong Untong & Phanin Khureathai & Mingsarn Kaosa-ard, 2011. "The Operational Efficiencies of the Hotel and Guesthouse Business in Thailand," Applied Economics Journal, Kasetsart University, Faculty of Economics, Center for Applied Economic Research, vol. 18(1), pages 44-63, June.
  • Handle: RePEc:aej:apecjn:v:18:y:2011:i:1:p:44-63
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    More about this item

    Keywords

    hotel; guesthouse; operational efficiency; stochastic meta-frontier;

    JEL classification:

    • C20 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - General
    • C50 - Mathematical and Quantitative Methods - - Econometric Modeling - - - General
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism

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