Forecasting the Evolving Composition of Inbound Tourism Demand: A Bayesian Compositional Time Series Approach Using Platform Booking Data

Harrison Katz

Papers from arXiv.org

Abstract: Understanding how the composition of guest origin markets evolves over time is critical for destination marketing organizations, hospitality businesses, and tourism planners. We develop and apply Bayesian Dirichlet autoregressive moving average (BDARMA) models to forecast the compositional dynamics of guest origin market shares using proprietary Airbnb booking data spanning 2017--2025 across four major destination regions. Our analysis reveals substantial pandemic-induced structural breaks in origin composition, with heterogeneous recovery patterns across markets. In our analysis, the BDARMA framework achieves the lowest forecast error for EMEA and competitive performance across destination regions, outperforming standard benchmarks including na\"ive forecasts, exponential smoothing, and SARIMA on log-ratio transformed data in compositionally complex markets. For EMEA destinations, BDARMA achieves 27% lower forecast error than na\"ive methods ($p

Date: 2026-02, Revised 2026-04
New Economics Papers: this item is included in nep-ecm, nep-ets, nep-for and nep-tur
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