Modeling the Impact of Market Orientation, Circular Economy, and Innovation on Tourism Sustainability: A Structural Approach

Tourist destinations face increasing spatial, environmental, and social pressures. Therefore, it is necessary to direct the further development of tourism towards achieving overall balance, with a tendency to minimize all negative effects. One possible mechanism for establishing a harmonious relationship among all stakeholders in tourism is the causal relationship between the constructs of market orientation (MO), circular economy (CE), innovation (INN), and sustainability outcomes. Within this framework, the present study examines their interconnectedness through structural equation modeling (SEM). The empirical research was conducted on the island of Tenerife, Spain, with a sample of 108 tourism firms. The theoretical foundation of the model is based on the concept of the Tourism Cooperative (TC), which strives to place the environment at the center of the tourism dynamic system at the destination level. The results indicate the negative influence of MO on CE, the mediating role of INN between MO and CE, the direct influence of INN on sustainability dimensions, both directly and indirectly via CE, as well as the bridging role of global partnerships in achieving social sustainability. These findings provide a solid theoretical basis and practical guidelines for tourism stakeholders, particularly tourism firms.