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An Exploration of Luxury Hotels in Tanzania

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  • Diego A. Comin

Abstract

Tourism is a tradable service activity that could allow some African countries to generate significant growth. Tanzania, given its unique natural assets, is an ideal candidate. However, despite being so richly endowed in touristic resources, Tanzania receives very few tourists and revenues from tourism. To explore the determinants of this performance, I conduct an international survey for upscale hotel managers to measure supply-side constraints on the operation of hotels. The survey reveals that hotels in the safari area in Tanzania are more expensive than comparable hotels, and that this difference in price cannot be accounted for by differences in supply constraints. Further, using cross-country panel data, I show that upscale hotel prices account for a significant fraction of cross-country differences in tourists.

Suggested Citation

  • Diego A. Comin, 2012. "An Exploration of Luxury Hotels in Tanzania," NBER Working Papers 17902, National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberwo:17902
    Note: CF
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    JEL classification:

    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • L89 - Industrial Organization - - Industry Studies: Services - - - Other

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