Estimation of Outbound Italian Tourism Demand: A Monthly Dynamic EC-LAIDS Model

Isabel Cortés-Jiménez, Ramesh Durbarry and Manuela Pulina
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Isabel Cortés-Jiménez: Christel DeHaan Tourism and Travel Research Institute and AQR-IREA, Nottingham University Business School, Jubilee Campus, Nottingham NG8 1BB, UK
Ramesh Durbarry: School of Sustainable Development and Tourism, University of Technology, Mauritius, La Tour Koenig, Pointe aux Sables, Mauritius

Tourism Economics, 2009, vol. 15, issue 3, 547-565

Abstract: An almost ideal demand system with monthly frequency, in both long-run and dynamic forms, is used to quantify the responsiveness of Italian tourism demand to changes in relative prices, exchange rates, expenditure and unexpected one-off events in four main European destinations. Short-term elasticities, which are crucial for policies regarding own price, as well as cross prices and expenditure elasticities are derived from the dynamic model. It is also found that the dynamic model outperforms the long-run model in forecasting accuracy. This paper provides useful information for policymakers to maintain high market shares of Italian tourism demand.

Keywords: Italian tourism demand; almost ideal demand system (AIDS); error correction; forecasting; monthly frequency (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (14)

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Persistent link: https://EconPapers.repec.org/RePEc:sae:toueco:v:15:y:2009:i:3:p:547-565

DOI: 10.5367/000000009789036594

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