Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism JOÃO ROMÃO Supervisors: Paulo M. M. Rodrigues João Pinto Guerreiro PhD Program in Tourism – Faculty of Economics – University of Algarve 2012
Jan 28, 2015
Tourism and Territorial Differen1a1on:
An Analysis of the Compe11veness and Sustainability of Tourism
JOÃO ROMÃO
Supervisors: Paulo M. M. Rodrigues João Pinto Guerreiro
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
1. Objec1ves, Achievements and Contribu1ons 2. Conceptual Framework Regional Tourism System Innova=on and Differen=a=on Compe==veness and Sustainability Tourism Area Life Cycle 3. Panel Data Model Methodology (data, variables and model) Results 4. Discussion Conclusions and Proposals Limits and Developments
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
1. Objec1ves, Achievements and Contribu1ons
The main purpose of this work is to propose an integrated approach to compe11veness and sustainability in tourism,
es1ma1ng the impacts of factors related to sustainability on the regional tourism compe11veness
through innova1ve ac1vi1es based on natural and cultural resources that differen1ate the des1na1ons.
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
Development of a regional tourism demand func1on, based on a panel-‐data model,
integra1ng ques1ons related to sustainability as new determinants of compe11veness.
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
Applica1on of the Tourism Area Life Cycle model in order to analyse regional tourism compe11veness
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
Analysis of the implica1ons of tourism compe11veness on sustainable regional development.
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
Analysis of the the rela1ons between regional innova1on systems and tourism compe11veness.
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
Romão, J., Guerreiro, J. and Rodrigues, P. (2012) Innova=ve Integra=on in Tourism, Discussion Papers -‐ Spa0al and Organiza0onal Dynamics, CIEO, University of Algarve
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
Romão, J., Guerreiro, J. and Rodrigues, P. (2013) Compe11veness and Sustainability in Tourism Des1na1ons, in Ma=as, Nijkamp and Sarmento (eds) Quan0ta0ve Methods in Tourism Economics, Springer-‐Verlag Berlin Heidelberg Romão, J., Guerreiro, J. and Rodrigues, P. (2012) Tourism Area Life-‐Cycle and Regional Tourism AUrac1veness, Current Issues on Tourism Romão, J., Guerreiro, J. and Rodrigues, P. (2012) Regional Tourism Development: Compe11veness and Sustainability, in Jafari, Fayos-‐Solá and Silva (eds) Knowledge Management in Tourism: Policy and Governance Applica0ons -‐ Bridging Theory and Prac0ce Vol. IV, 55-‐75, UNWTO, Emerald Romão, J., Guerreiro, J. and Rodrigues, P. (2012) Innova1ve Integra1on in Tourism, Discussion Papers -‐ Spa0al and Organiza0onal Dynamics, CIEO, University of Algarve
4 ar%cles as a result of this disserta%on:
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
Local Resources, Differen1a1on and Innova1on in Tourism Workshop, Centre for Advanced Tourism Studies, Hokkaido University, Sapporo, Japan (2012) Tourism Area Life-‐Cycle and Regional Tourism AUrac1veness Interna=onal Conference on Tourism & Management Studies, Faro, Portugal (2011) Territory, Innova1on and Differen1a1on in Tourism Hospitality and Tourism Marke=ng and Management, Washington State University and Bogazici University, Istanbul, Turkey (2011) Regional Tourism Development: Innova1on, Compe11veness and Sustainability Tourism and Science: Bridging theory and prac=ce, UNWTO and University of Algarve, Vilamoura, Portugal (2011) Compe11veness and Sustainability in Tourism Des1na1ons Advances in Tourism Economics, APIDT, Lisbon, Portugal (14-‐04-‐2011) Sustainable Tourism and Territorial Differen1a1on Cluster 2, NECTAR, Rome, Italy (22-‐10-‐2010)
6 communica%ons as a result of this disserta%on:
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
Romão, J., Neuts, B., Nijkamp, P., Leeuwen, E.S. van (2013) Tourist Loyalty and e-‐Services: A Comparison of Behavioural Impacts in Leipzig and Amsterdam [submi`ed] Romão, J., Neuts, B., Nijkamp, P., Leeuwen, E.S. van (2013) Urban Tourist Complexes as Mul1-‐Product Companies: Market Segmenta1on and Product Differen1a1on in Amsterdam, Tourism Management [re-‐submi`ed aber peer-‐review] Neuts, B., Romão, J., Nijkamp, P., Leeuwen, E.S. van (2013) Modelling the Complex Components of Tourist Loyalty, in Ma=as, Nijkamp and Sarmento (eds) Advances in Tourism Economics, Springer-‐Verlag [approved] Neuts, B., Romão, J., Nijkamp, P., Leeuwen, E.S. van (2013) Digital des1na1ons in the tourist sector: a path model for the impact of e-‐services on tourist expenditures in Amsterdam, LeMers in Spa0al and Resource Sciences [approved]
4 other ar%cles on Tourism issues:
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
Romão, J., Nijkamp, P., Leeuwen, E.S. van, Kour=t, K., Ozasa, T. and Komatsu, M. (2013) Designing a Sustainable University Campus: A Mul1-‐Criteria Assessment of Value-‐based Metrics through Living Lab Images [submi`ed] Communica%on presented at: Interna1onal Symposium on Crea1on of Sustainable Campuses (2012) Hokkaido University, Sapporo, Japan
Ar%cle on Sustainability:
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
2. Conceptual Framework
Territorial Differen1a1on, Compe11veness and Sustainability of Tourism João Romão – João Guerreiro – Paulo Rodrigues
UNWTO (2000) defines tourists as “people who travel to and stay in places outside their usual environment for more than twenty-‐four (24) hours and not more than one consecu1ve year for leisure, business and other purposes not related to the exercise of an ac1vity remunerated from within the place visited” (in Vanhove, 2005) This defini1on clearly exposes the dynamic character of tourism (travelling to a des1na1on that is different from the residence place of the tourist) and a sta1c dimension (related to the experiences, services and products used by tourists while staying in a specific des1na1on). At the same 1me, it simultaneously exposes the global (related to global markets and interna1onal travels) and the local character of tourism (related to the specific condi1ons of each par1cular des1na1on).
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Territorial Differen1a1on, Compe11veness and Sustainability of Tourism João Romão – João Guerreiro – Paulo Rodrigues
Des1na1on and Experience: even if tourism services are provided by a large number of companies, tourists perceive des1na1ons as an integrated experience: the tourism experience is a result of mul1ple products, services and ac1vi1es but each tourist creates his own image of a des1na1on aber the visit. The quality of the tourism experience depends on the sa1sfac1on with a large set of products and services provided in each des1na1on and can vary with the characteris1cs, expecta1ons and mo1va1ons of each tourist.
Tourism des1na1ons are heterogeneous mul1-‐product, mul1-‐client business organiza1ons
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Territorial Differen1a1on, Compe11veness and Sustainability of Tourism João Romão – João Guerreiro – Paulo Rodrigues
Innova1on in tourism results from all the interac1ons between companies, among firms and costumers (taking benefits from the increasing interac1vity), technological developments resul1ng from the coopera1on between tourism companies and R&D ins1tu1ons or even from from outside the tourism sector (like the developments of informa1on and communica1on technologies) As tourism supply is becoming increasingly complex and using technologically sophis1cated means of communica1on, tourism is an increasingly knowledge based ac1vity globally distributed, where innova1ons have a global diffusion.
Computer Reserva1on Systems Global Distribu1on Systems Geographical Informa1on Systems Infography and design Interac1ve sobware
Massifica1on of the internet Massifica1on of mobile phones Web 2.0 Personalized the processes of communica1on Costumer Rela1on Management
Media1za1on of tourism and tourist informa1on produced by tourists Personal blogs Photography and video websites
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Territorial Differen1a1on, Compe11veness and Sustainability of Tourism João Romão – João Guerreiro – Paulo Rodrigues
The processes of innova1on based on local specific resources cannot be imitated and they definitely can contribute to the differen1a1on of a tourism des1na1on. Local interac1on between producers and consumers in a territory enhances the importance of local and regional innova1on networks for tourism: co-‐terminality of produc1on and consump1on, temporality (produc1on and consump1on occur at the same 1me) and spa1ality (consump1on must occur in the place where services are produced) imply that costumers act as “co-‐creators” in the innova1on process. Tacit knowledge is par1cularly important for innova1on: -‐ necessary to codify explicit knowledge -‐ difficul1es to be imitated -‐ larger impacts on compe11veness.
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Territorial Differen1a1on, Compe11veness and Sustainability of Tourism João Romão – João Guerreiro – Paulo Rodrigues
The differen1a1on of tourism des1na1ons ensuring its aUrac1veness in the long-‐run depends on the development of innova1ve products and services related to the natural and cultural characteris1cs of the territory. Monopolis1c compe11on with other des1na1ons, based on differen1a1on instead of a cost-‐leadership compe11on, leads to higher posi1ve impacts on the local economies and smaller nega1ve impacts on natural and cultural resources. Usage of local natural and cultural resources for tourism ac1vi1es must consider their preserva1on in the long run (pressure on degrada1on and limits to their usage) and their value for local communi1es (right to take benefit of local resources). High level of involvement of local stakeholders is required, in order to avoid a path “from euphoria to antagonism” (Doxey, 1976) or “from euphoria to xenophobia” (Wall and Mathieson, 2006) in the way that local communi1es perceive the presence of tourists.
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
Innova1on in Tourism
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Territorial Differen1a1on, Compe11veness and Sustainability of Tourism João Romão – João Guerreiro – Paulo Rodrigues
In the long run, compe11veness of tourism des1na1ons is linked to their sustainability.
In order to sustain the characteris1cs that guarantee aUrac1veness, local natural and cultural aspects must be included in the tourism supply, crea1ng a differen1ate product.
Des1na1ons are the core element of the compe11on and experience is the fundamental product in tourism.
There is a clear meaning for the firm compe==veness but the same does not happen when regional compe==veness is discussed (Hall, 2007). Compe==veness should not be applied to na=onal economies (Krugman, 1994).
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Natural and Cultural Resources
Differen=a=on Innova=on
Sustainability Management
Compe==veness
The usage of natural and cultural resources to create innova1ve products and services
implies an adequate management that ensures their sustainability:
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
Territorial Differen1a1on, Compe11veness and Sustainability of Tourism João Romão – João Guerreiro – Paulo Rodrigues
“what makes a tourism des1na1on truly compe11ve is its ability to increase tourism expenditure, to increasingly aUract visitors while providing them with sa1sfying experiences, and to do so in a profitable way, while enhancing the well-‐being of des1na1on residents and preserving the natural capital of the des1na1ons for future genera1ons”. Ritchie and Crouch, 2003 This defini1on makes explicit reference to the ideas of: growth (increasing revenues and visitors), sa1sfac1on of consumers (sa1sfying experiences), posi1ve consequences on the local communi1es (well-‐being of residents), preserva1on of local resources (preserving natural capital) and 1me (future genera1ons) “Compe11veness is illusory without sustainability. Indeed, in our view the phrase, sustainable compe11veness, is tautological”. Ritchie and Crouch, 2000
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Territorial Differen1a1on, Compe11veness and Sustainability of Tourism João Romão – João Guerreiro – Paulo Rodrigues
Common output indicators for compe11veness in tourism are: the number of arrivals to des1na1ons, the number of tourists who repeat the visit, the number of nights in local accommoda1on services, market shares, produc1vity or the revenues generated by tourism ac1vi1es. From the input side, regarding the factors influencing competi1veness, there is a wide range of possibili1es considered in the literature: Kozak (1999) Dwyer and Kim (2003) Ritchie and Crouch (2003) Vanhove (2005) Mazanek (2007) Navickas and Malakauskaite (2009) Tsai (2009) ”A des=na=on is not compe==ve in abstract terms but against relevant compe=ng des=na=ons; in order to evaluate compe==veness, it is necessary to understand which are the compe==ve des=na=ons” (Enright and Newton, 2005) Management and tourism development policies cannot be defined in abstract and in generalized ways, but must be adequate to the specific condi=ons of each des=na=on: universal policy and managerial recommenda=ons can lead to relevant and unwanted nega=ve consequences (Enright and Newton, 2005)
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
The TALC model (Butler, 1980) defines a standard for the evolu=on of tourism des=na=ons with five stages (involvement, explora=on, development, consolida=on and stagna=on) Considering the limited period under analysis (six years), a simplified version of the model has been chosen, with 3 stages.
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
The posi1on of each region was iden1fied in two steps: The growth rate of nights spent by tourists in each region in the period 2003 – 2008 allows the iden1fica1on of regions with high rates of growth (>2,5% per year). As it is assumed that the development stage of a tourism area is characterized by high rates of growth in tourism demand, all these regions are posi1oned in the “Development” stage;
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
For the regions with low (or nega1ve) rates of growth, the level of specializa1on was calculated using a Loca1on Quo1ent related to the employment in hotels and restaurants (dividing the weight of employment in hotels and restaurants in each region by the weight of employment in hotels and restaurants in all the regions). As it assumed that the evolu1on along the different stages is characterized by an increasing importance of economic ac1vi1es related to tourism, regions with higher specializa1on in tourism ac1vi1es were posi1oned in the “Stagna1on” stage (meaning that tourism is economically important but growth rates are low) and regions less specialized in tourism were classified in the “Explora1on” stage (meaning that tourism is economically less important but growth rates are high).
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
In this study, the specific situa1on of each region has been considered including aspects related to Geography and History (posi1on in the Tourism Area Life Cycle)
Geography: Inland, West Coast (Atlan1c) and South Coast (Mediterranean)
TALC: Explora1on, Development and Stagna1on
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
According to the TALC model, un1l a certain moment, the growth of tourism in a region is characterized by a growing involvement of local communi1es and impacts on local economies. Aber that point, overexploita1on of tourism resources creates pressure on the local environment or the resident’s life quality, reducing the aUrac1veness of the place. This general tendency is not equally observed in all the des1na1ons: each stage can have a different dura1on in different des1na1ons, which results, not only from the evolu1on of the des1na1on itself but it is also related to the compe11on with rival and similar places or to the evolu1on of demand and issuing markets. The model does not have an universal applica1on and the iden1fica1on and measurability of these stages is not always clear, or even possible, due to the absence of informa1on. The regional unit considered in this study (NUTS 2) is not a tourism des1na1on: many of these regions include different tourism products, not necessarily in the same stage of development. Although this model defines a unique standard of evolu1on, at least in the first stages, it also emphasizes the dynamic and evolving character of tourism des1na1ons. The model helps to iden1fy general tendencies, to an1cipate problems and opportuni1es and to create adap1ve strategies to respond to the evolu1on of tourism ac1vity.
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
“it is clear that a simple model like the TALC cannot predict in detail the future of a specific des1na1on engaged in the global compe11on that is tourism today. (...) This is a func1on of the increasing number of opportuni1es and op1ons available to holiday makers in the 21st century. A unidirec1onal linear model is rela1vely unlikely to give an accurate predic1on of the future of a complex product subject to rapid change and great compe11on” Butler (2009) The iden1fica1on and measurability of these stages is not always clear, or even possible, due to the absence of sta1s1cal informa1on, namely on the first stages of evolu1on of a tourism des1na1on. Even with the existence of limits to the predic1ve possibili1es of the model and to the precise iden1fica1on of each stage in the evolu1on of a des1na1on, the TALC model is clearly a useful tool to understand the evolving character of tourism areas, their change, development, muta1ons of the compe11ve advantage determinants, economic impacts and environmental or cultural consequences, not only on the tangible local assets but also on intangible aspects of local daily life.
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
Since the dura1on of the life cycle of the tourism des1na1ons considered in this study is rela1vely long (organized and ins1tu1onalized tourism started to develop in the second half of the XX century in most of these regions but other forms of leisure and tourism existed already before that), this implies that the dura1on of each stage considered in this study is also long, which means that regions classified in the same stage can s1ll show important differences among them. Andalucía (Spain) is a region with a long tradi1on in tourism ac1vi1es, while Azores (Portugal) or Extremadura (Spain) have a much more recent tradi1on. However all of them are classified in the development stage as a result of the high growth rates of tourism demand registered in these years.
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
3. Panel Data Model
This work analyses how the regions (NUTS 2) of south-‐west Europe are incorpora1ng their natural and cultural resources in order to reinforce their aUrac1veness, using a panel-‐data model to es1mate a regional demand func1on (for 2003 – 2008) that incorporates new and tradi1onal factors of tourism compe11veness.
67 regions were analysed (17 in Spain, 22 in France, 21 in Italy; 7 in Portugal). NUTS 2 regions are the unit of analysis considering the availability of comparable data and the existence of ins=tu=ons related to economic development, cultural and natural resources management and tourist promo=on. Nevertheless, these regions can include different tourism des1na1ons and products.
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
The posi1ons of these coun1es in the Travel and Tourism Compe11veness Index are clearly above their posi1ons in the Global Compe11veness Index
(World Economic Forum, 2008)
Tourism Compe11veness
Global Compe11veness
Spain 5 29 France 10 16 Portugal 15 43 Italy 28 49
In 2008, these countries registered 48,5% of the nights spent in European hotels and similar establishments.
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
The dependent variable in this model is the number of nights spent by tourists in hotels and similar establishments in each region, which we assumed to be a proxy to regional tourism compe11veness.
Nights in Hotels Annual Growth
Açores (PT) 6,6
Com. de Madrid (SP) 6,6
Lisboa (PT) 6,4
Lazio (IT) 5,7
Aragón (SP) 5,4
Castilla-Mancha (SP) 5,3
Piemonte (IT) 5,3
Extremadura (SP) 5,1
Castilla León (SP) 4,9
País Vasco (SP) 4,7
Centro (PT) 4,4
La Rioja (SP) 4,3
Navarra (SP) 4,1
It is possible to iden1fy the importance of the capital ci1es, sugges1ng the growing relevance of urban and cultural tourism.
Nights in Hotels % Acum. %
Canarias (SP) 7,8 7,8
Ile de France (FR) 6,2 14,0
Calatuña (SP) 5,8 19,7
Illes Balears (SP) 5,5 25,3
Veneto (IT) 5,5 30,8
Andalucia (SP) 5 35,8
Toscana (IT) 3,8 39,6
Emilia-Romagna (IT) 3,5 43,1
Com. Valenciana (SP) 3,5 46,6
Prov-Alp-C. d’Azur (FR 3,2 49,8
10 regions represent 50% of the overall number of nights in hotels and similar establishments.
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
New factors of compe11veness: It is assumed that local natural and cultural assets are the basis for the differen1a1on of tourism des1na1ons according to the characteris1cs of the territory but it is also important to no1ce that availability of these assets does not necessarily mean that they are exploited as tourism resources: it means that such poten1al exists at the regional level and that their exploita1on implies an effort for the development of innova1ve products and services.
The model also considers some Tradi1onal factors of compe11veness
(aspects related to economic condi1ons and infrastructures)
The new factors that determine the compe11veness of tourism des1na1ons include local specific resources related to nature and culture.
These resources are considered as a poten1al (not necessarily as tourism products).
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
Regional efforts on innova1on are considered in the model under the assump1on that those local specific poten1ali1es require innova1ve efforts at regional level
in order to contribute to differen1ate des1na1ons.
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
Some tradi1onal factors of compe11veness were also considered: economic condi1ons (investment in hotels and restaurants; evolu1on of GDP in na1onal markets and at UE15, as the main interna1onal market) performance of rival des1na1ons in south-‐east European countries (number of nights in hotels from Turkey, Greece, Croa1a and Cyprus) infrastructures (accommoda1on and existence of interna1onal airports)
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
Geography and History:
The geographical situa1on of each region and its posi1on in the Tourism Area Life Cycle were taken into considera1on using dummy variables:
Inland, West – Coast and South – Coast
Explora1on, Development and Stagna1on
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
Territorial Differen1a1on, Compe11veness and Sustainability of Tourism João Romão – João Guerreiro – Paulo Rodrigues
Aber fiung some alterna1ve regressions and transforma1ons on the variables, the best results were obtained with a Pooling Effects Model and applying logarithms to the variables “nights”, “beds”, “GDP”, “GDP EU15”, “Invest” and “Rivals”.
In a Polling Effects Model, there are no unique aUributes of individuals or universal effects along 1me.
Panel data models include cross-‐sec1onal data that reflect the differences among regions and 1me-‐series data that reflect the evolu1on along 1me.
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Estimate St. Error t-value Pr(>|t|) Sign.
Intercept 13,82722 1,19577 11,5635 <2,2e-16 0
logbeds 0,70682 0,02825 25,0186 <2,2e-16 0
air 0,13708 0,04335 3,1619 0,00169 0,001
loginvest 0,23912 0,02206 10,8385 <2,2e-16 0
logGDPn -0,93440 0,12630 -7,3984 8,531e-13 0
ST 1,12374 0,22830 5,0099 8,272e-7 0
Heritage 0,02378 0,00939 2,7467 0,00630 0,001
Natura 0,68802 0,19776 3,4791 0,00056 0
Geo1 -0,06182 0,03823 -1,6173 0,10661 0,1
Geo2 -0,29830 0,04416 -6,7558 5,184e-11 0
TALC1 -0,27510 0,04359 -6,3116 7,516e-10 0
TALC2 -0,22706 0,04389 -5,1735 3,681e-7 0
Es1mators:
Some variables were not sta1s1cally relevant: “GDPUE15”; “Rivals”; “Educa1on”.
The final model was expressed as: Lognights it = ß0 + ß1 logbeds it + ß2 air it + ß3 log GDP it + ß4 loginvest it-‐1+ ß5 ST it + ß6 Heritage it + ß7 Natura it + ß8 GEO1 it + ß9 GEO2 it + ß10 TALC 1 it + ß11 TALC 2 it
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
In order to iden1fy possible problems of mul1collinearity among the independent variables, a VIF (Variance Infla1on Factor) test has been calculated.
It is accepted that problems of mul1collinearity can be relevant when VIF is above 10. In this model, the VIF test presents values below 5 for all the independent variables.
Descrip1ve sta1s1cs
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
As the model includes some dummy variables, it is possible to organize its results according to the groups that result from those variables,
which have different independent terms, reflec1ng different overall impacts of the independent variables
on the regional tourism demand in each group. Generally, these impacts are higher in the South Coast regions and lower in the West Coast.
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
4. Discussion
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
The posi1ve impact of new factors of compe11veness detected by this model is the most important result of its applica1on. It was possible to observe that natural resources, heritage assets and regional efforts on innova1on are posi1vely related with regional tourism compe11veness.
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
The results also show an expected posi1ve correla1on between the existence of infrastructures (beds and airports), investment in hotels and restaurants and the regional tourism compe11veness. The nega1ve correla1on found between the nights spent in a region and its na1onal GDP suggests that countries where tourism is more important are economically less developed, implying that this variable was not relevant to iden1fy the influence of the evolu1on of na1onal economic condi1ons on the domes1c tourism demand.
Tourism development policies require coordina1on among different management ins1tu1ons, namely those related to economic development, promo1on of innova1on,
tourism des1na1on management, environmental protec1on or cultural promo1on.
In order to ensure that these processes effec1vely benefit local popula1ons, local stakeholders should necessarily be involved.
According to these principles, ins1tu1onal coordina1on is a major challenge
for tourism development based on local and natural assets, considering the need to involve a large set of private companies and public en11es,
frequently with different perspec1ves and objec1ves, in the processes of tourism development planning.
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
For des1na1ons in the earlier stages of their life cycle (explora1on), it is important to create adequate infrastructures, develop new services, guarantee a good level of qualifica1ons of the workers (namely with knowledge of different languages), iden1fy poten1al markets and implement adequate promo1onal strategies. Sustainable development and long-‐term advantages will be easier to reach if carrying capacity of local resources is considered since the beginning (with an adequate process of land-‐use planning), the involvement of local stakeholders is ensured and ins1tu1onal coordina1on is promoted. For the regions in the “development” stage, it is important to control the excessive pressure on the territory resul1ng from poten1al excessive demand (at least in some periods of the year), develop alterna1ve products and services in order to avoid seasonality and try to improve the quality of the experience offered by the des1na1on, through an improvement of the products and services locally provided. Increasing value added in local supply becomes more important than increasing the number of visitors. For the regions in the late stages of the life-‐cycle (like stagna1on), new products or new markets are essen1al for tourism development but, considering the extreme global compe11on among tourism des1na1ons, it is also important that those local resources have not been destroyed by an excessive usage in the previous stages. In this stage, the priori1es should focus on the reposi1oning of tourism supply, crea1ng and promo1ng new products and services, based in new approaches to local specific resources.
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
Limits and developments: Regional Unit: NUTS 2 regions as the unit of analysis can hide some possible intra-‐regional differences related to different tourism products developed inside the same region, eventually with different posi=ons in their life cycles. Further developments of this work can include a shib in the scale of analysis, for example using data for NUTS 3 regions, if there is enough informa=on on the relevant topics. Period and Territory: This study took into considera=on a period of six years, ending in 2008. Aber that, an important interna=onal economic crisis with deep implica=ons on the revenues and the behavior of consumers at the global level occurred, with relevant nega=ve impacts on tourism. Enlarging the number of regions and the period under analysis, including the most recent years, could contribute to iden=fy different impacts of economic crisis on tourism des=na=ons and to compare the evolu=on of the a`rac=veness in tourism regions with different characteris=cs.
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
Markets: Including some explanatory variables related to the rela=ve importance of each market for each des=na=on (and their specific evolu=on in the context of this economic crisis and recovery) can also increase the predic=ve capability of the model. In the same sense, it may be important to include in the model informa=on related to produc=on costs (although there is a very relevant part of tourism expenses which is not controlled at the regional level). Ins1tu1ons: The considera=on of aspects related to des=na=on management and promo=on, ins=tu=onal organiza=on or involvement of local communi=es in the process of tourism development is extremely important, despite the difficulty to obtain relevant comparable data. Life Cycle: Indicators related to the resident’s percep=ons about tourism could also be included in order to iden=fy the posi=on of each region in the Tourism Area Life Cycle model. More detailed informa=on about the first and last stages of the model could be useful, implying the considera=on of longer periods.
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
Sustainability: Cultural and natural assets were taken into considera=on as locally available resources but it would surely be more interes=ng to evaluate them as tourism products. Ques=ons related to carrying capacity and the possible excessive usage of natural resources or commodifica=on of cultural community values should be also important elements to consider, despite their difficult quan=fica=on and comparison at interna=onal level. Regional and Societal Development: “Social sustainability”, or the spreading of benefits to local communi=es, could be considered including indicators like the regional employment in tourism ac=vi=es, stability of jobs or wages. Innova1on: The regional processes of innova=on can also be analyses in more detail, in order to try to iden=fy the regional dynamics of innova=on specifically in the tourism sector, namely when it is related to the usage of communica=on and informa=on technologies or the capacity to produce new technological solu=ons for tourism (considering the number of registered patents or other indicators) and their impacts on regional tourism compe==veness. Methodologies: Other sta=s=cal tools and methodologies could be applied to this king of study, such as Simultaneous Equa=on Models
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
PhD Program in Tourism – Faculty of Economics – University of Algarve -‐2012
Tourism and Territorial Differen1a1on: An Analysis of the Compe11veness and Sustainability of Tourism
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