IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/26073.html
   My bibliography  Save this paper

Domestic tourism demand in Italy: a Fixed Effect Vector Decomposition estimation

Author

Listed:
  • Massidda, Carla
  • Etzo, Ivan

Abstract

This study investigates the main determinants of the Italian domestic tourism demand measured in terms of regional bilateral tourism flows. We consider a large panel of explanatory variables meant to capture not only the role of traditional economic demand-driven forces, but also qualitative supply-side factors that can be crucial in determining the comparative advantage of the exporting regions. The empirical analysis, performed in the context of an extended gravity model, builds on the Fixed Effect Vector Decomposition estimator (FEVD) developed by Plümper and Troeger (2007). The investigation is conducted for the country as a whole and separately for the two macro-areas, namely the Centre-North and the South. According to our results, at aggregate level, the main determinants of Italian tourism flows appear to be the lagged dependent variable, which control for reputation and habit formation, and relative prices. Also the per capita GDP plays a significant role, but its coefficient suggests that in Italy domestic tourism does not behave as a luxury good, as frequently found in the international tourism context. Another interesting result is that for Italian tourists, domestic destinations and international destinations act as substitutable goods. At sub-sample level two main findings are worth noting. On the one hand, the main outcomes of the full sample analysis are confirmed, on the other hand some interesting differences arise with respect to the impact of the relevant variables. In particular, tourists coming from the southern regions appear to be more concerned than northern ones about variations in their per capita GDP and in price differences.

Suggested Citation

  • Massidda, Carla & Etzo, Ivan, 2010. "Domestic tourism demand in Italy: a Fixed Effect Vector Decomposition estimation," MPRA Paper 26073, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:26073
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/26073/1/MPRA_paper_26073.pdf
    File Function: original version
    Download Restriction: no

    References listed on IDEAS

    as
    1. Santeramo, Fabio G. & Seccia, Antonio & De Blasi, Giuseppe & Carlucci, Domenico, 2008. "Agritourism flows to Italy: an analysis of determinants using the gravity model approach," 107th Seminar, January 30-February 1, 2008, Sevilla, Spain 6623, European Association of Agricultural Economists.
    2. Cornwell, Christopher & Rupert, Peter, 1988. "Efficient Estimation with Panel Data: An Empirical Comparison of Instrumental Variables Estimators," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 3(2), pages 149-155, April.
    3. Naudé, Wim & Saayman, Andrea, 2005. "Determinants of tourist arrivals in Africa: a panel data regression analysis," MPRA Paper 16479, University Library of Munich, Germany.
    4. Plümper, Thomas & Troeger, Vera E., 2007. "Efficient Estimation of Time-Invariant and Rarely Changing Variables in Finite Sample Panel Analyses with Unit Fixed Effects," Political Analysis, Cambridge University Press, vol. 15(02), pages 124-139, March.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Domestic tourism flows; Gravity model; Fixed Effect Vector Decomposition;

    JEL classification:

    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:26073. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Joachim Winter) or (Rebekah McClure). General contact details of provider: http://edirc.repec.org/data/vfmunde.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.