Discrete Choice Analysis of Foreign Travel Demand
The paper reports estimation results from a micro-econometric model of travel demand. A nested multinomial logit model is used to determine the country in which vacation is spent. As an extension of the model, we also consider the simultaneous explanation
- PDF / 2,714,503 Bytes
- 34 Pages / 482 x 692 pts Page_size
- 0 Downloads / 235 Views
Abstract The paper reports estimation results from a micro-econometric model of travel demand. A nested multinomiallogit model is used to determine the country in which vacation is spent. As an extension of the model, we also consider the simultaneous explanation of both qualitative choice of destination and quantitative demand as measured by per capita expenditure.
1
Introduction
The growth of leisure time in industrialized countries has increased economists' interest in those industries which meet the needs and demands created by leisure such as entertainment, sports, and tourism. In particular, travelling has become an economic factor and travelling abroad considerably affects balances of payments, at least for European countries: •Research for this paper is financially supported by Deutsche Forschungsgemeinschaft, SFB 178 "Internationalisierung der Wirtschaft" at University of Konstanz. We wish to thank Martin Sinemus for assistance in data editing and preparation. Provision of microdata by "Zentralarchiv fUr empirische Sozialforschung" and "Studienkreis fUr Tourismus e.V." is gratefully acknowledged.
H.-J. Vosgerau (ed.), European Integration in the World Economy © Springer-Verlag Berlin Heidelberg 1992
642
a) Aggregate world expenditure for foreign travel in 1985 amounted to 70 billion dollars 1 which covers approximately 20 % of the annual raw oil production.
b) German tourists spent about 20% of this amount (14 billion dollars) whereas only 5.6 billion dollars are spent by foreign tourists coming to Germany. This created a deficit of about 8.4 billion dollars, which should be compared with the total surplus of the German balance of payments of approximately 25 billion dollars.
c) As table 1 shows, the revenues from foreign tourists in Germany have always been a small fraction of what Germans spent abroad, creating a considerable deficit in the balance of payments. Since the early seventies this fraction has been about one third, whereas figure 1 indicates that the percentage of trips to foreign countries has increased continuously.
d) Expenditure of German tourists abroad amounted to DM 45 billion, representing about 8 % of all German imports of goods and services (and more than 25 %of services alone), thus making (foreign) tourism one of the most important items in the German balance of payments.
Moreover, the relative number of leisure induced trips to non-domestic destinations has increased steadily. Throughout the period of 1954 to 1987 the percentage of non-domestic destinations of German tourists has increased from 15 %to 69 %, as shown by figure 1. It is therefore interesting to know why people spend their vacation abroad and what explanatory variables direct the demand for foreign tourism. There are a number of empirical studies related to this question. However, they all use aggregate time series data. Gray (1966, 1970) has been one of the first to analyse the relation between international travel and international trade. A similar econometric analysis has been presented by Artus (1972).
Data Loading...
