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On the economic rationality of fluctuations in tourism frequentation at nature-based destination

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  • Giannoni, Sauveur

Abstract

The aim of this paper is to answer a simple question: Are fluctuations, and especially temporary decline, in frequentation always harmful for the pro�t of a tourism destination? I propose a simple model for a nature-based destination, in which the willingness to pay of a tourist for the destination depends on the stock of natural assets, and I show using simulations that there exists a rational economic incentive to experience a decrease in frequentation for a while in order to let the stock of natural assets regenerates. This is an idea already emphasized by Greiner et al. (2001) and Kort et al.(2002). I show that anyway the optimal behavior of a pro�fit-maximizing representative tourism �firm would generally lead to a monotonic frequentation path. This apparent contradiction is due to the fact that the level of frequentation is not, in the real world, set at its optimal level. Yet it could be good news if at some point, when the stock of natural assets is low, frequentation declines for a while.

Suggested Citation

  • Giannoni, Sauveur, 2011. "On the economic rationality of fluctuations in tourism frequentation at nature-based destination," MPRA Paper 29518, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:29518
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    References listed on IDEAS

    as
    1. F. Cerina, 2006. "Tourism specialization and environmental sustainability in a dynamic economy," Working Paper CRENoS 200602, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
    2. Greiner, Alfred & Feichtinger, Gustav & Haunschmied, Josef L. & Kort, Peter M. & Hartl, Richard F., 2001. "Optimal periodic development of a pollution generating tourism industry," European Journal of Operational Research, Elsevier, vol. 134(3), pages 582-591, November.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Tourism; Willingness to Pay; Fluctuations;

    JEL classification:

    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism

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