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Search Cost Reduction Increases Variation In Hotels Occupancy Rate: A Theoretical And Empirical Analysis


  • Marianna Succurro


  • Federico Boffa

    () (Dipartimento di Economia e Statistica, Università della Calabria)


This study explores how direct online booking affects the variation in hotel bed-places occupancy rate between peak and off-peak periods, thereby contributing to three strands of literature, respectively the determinants of seasonality, the tourist information acquisition process and the impact of the internet on tourism. The empirical analysis, covering 18 countries over the 1997-2007 period, investigates the impact of an increase in the use of the internet by consumers on the seasonal variation in the occupancy rate. We find that internet actually increases the variation in occupancy. We contribute to reduce the lack of a theoretical framework in this field by developing a formal model to illustrate why and how the reduction in search cost entailed by the use of the internet can indeed lead to a higher seasonality.

Suggested Citation

  • Marianna Succurro & Federico Boffa, 2010. "Search Cost Reduction Increases Variation In Hotels Occupancy Rate: A Theoretical And Empirical Analysis," Working Papers 201020, Università della Calabria, Dipartimento di Economia, Statistica e Finanza "Giovanni Anania" - DESF.
  • Handle: RePEc:clb:wpaper:201020

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    References listed on IDEAS

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    More about this item


    Internet; Search Costs; Net Occupancy Rate of bed-places;

    JEL classification:

    • D40 - Microeconomics - - Market Structure, Pricing, and Design - - - General
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms

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