Abstract
In Chap. 4, we discussed the concept of tourism demand as strictly referred to a given destination, a given type of tourism, or any combination of the two. In particular, we considered the tourism demand at the destination as the relationship between the number of overnight stays and the daily price of the holiday, and then we used it as a tool to study the economic problems facing the destination as well as to interpret its solutions in light of the planning and policy of tourism.
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- 1.
For an introduction of the basics of Consumer Theory, refer to any microeconomics textbook. For a quick recall of the consumer’s choice standard model, see Theory in Action 5.1.
- 2.
In a more general setting, the good y can be thought as the basket of remaining goods that can be consumed in alternative to x, requiring an overall spending of M units of currency. If this basket of goods is considered the numeraire, with price p = 1, the choice is between good x and the rest of spending M.
- 3.
This economic definition differs from the one we introduced in Chap. 2, where crossing a country’s border was considered a sufficient condition to generate international tourism. Indeed, in case the tourist’s country of origin shares the same currency with that of the destination (like any pair of countries in the Euro zone), we would record the trip as international tourism in the official statistics, without considering it as international tourism from a purely economic point of view. We refer to Chap. 14 for a deeper discussion of the economic distinction between domestic and international tourism, which ultimately relies on the role played by the exchange rate in the calculation of the price of tourism.
- 4.
These arguments link, for example, with the issues of coordination and variety for the destination management (see Sect. 4.3) or with the issue of double markup for the tour operator (see Sect. 11.5).
- 5.
Note that other definitions of preference separability exist. Indeed, we rely on the hypothesis of implicit separability which has to do with the structure of the consumer expenditure (Deaton and Muellbauer 1989).
- 6.
It has been demonstrated that weak separability is the necessary and sufficient condition to complete (at least) a two-stage budgeting choice (Deaton and Muellbauer 1989).
- 7.
A significant share of tourism trips includes visits to more than one destination. A model of multi-destination tourism trips is in de Oliveira Santos et al. (2011).
- 8.
For a full description of Bellman’s principle, we refer to any textbook of dynamic programming or advanced economics. For a simple description with an application to tourism, see Candela and Figini (2010a).
- 9.
The key assumption behind Fig. 5.4 is that the higher the income, the more enjoyable the tour is. Alternatively, we could assume a constant utility value for the holiday, a case that would only marginally change the diagram, with a parallel shift up of U in the chart, without affecting the essence of the choice problem.
- 10.
It is worth recalling that stock variables are measured at a point in time, while flow variables are measured over a period of time.
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Candela, G., Figini, P. (2012). The Consumer Theory Applied to the Tourist. In: The Economics of Tourism Destinations. Springer Texts in Business and Economics. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-20874-4_5
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