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AN ASSESSMENT OF VISITOR EXPENDITURE METHODS AND MODELS. Presented to the 37th Annual Conference of the Travel and Tourism Research Association By Douglas C. Frechtling Dept. of Tourism and Hospitality Mgmt. School of Business The George Washington University June 18, 2006.

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an assessment of visitor expenditure methods and models

AN ASSESSMENT OF VISITOR EXPENDITURE METHODS AND MODELS

Presented to the

37th Annual Conference of the

Travel and Tourism Research Association

By Douglas C. Frechtling

Dept. of Tourism and Hospitality Mgmt.

School of Business

The George Washington University

June 18, 2006

research on tourism s economic impact
Research on Tourism’s Economic Impact . . .
  • dates back three-quarters of a century:
  • Mathieson and Wall (1982) note F. W. Ogilvie’s 1933 book, The Tourist Movement
role of tourism economic impact studies
Role of Tourism Economic Impact Studies
  • Assist consumers, businesses and governments
  • in making efficient and effective
  • marketing and development decisions.
focus of tourism economic impact studies
Focus of Tourism Economic Impact Studies
  • Up to early 1990s: visitors’ year-round economic contribution to destinations
  • Last 15 years: economic benefits of visitors to specific events
centrality of visitor expenditures
Centrality of Visitor Expenditures
  • ”the consumption of tourism is . . . the foundation of the economic impacts of tourism and, therefore, understanding tourism consumption is essential for understanding tourism’s economic impacts.”(Mihalic 2002)
paper assesses methods to estimate visitor spending in defined geographic areas
Paper Assesses Methods to Estimate Visitor Spending in Defined Geographic Areas
  • Three contexts: occasion, venue, time frame
  • Three Principles: Relevance, Coverage, Accuracy
  • Examines eleven methods & models drawn from literature
  • Evaluates methods by Principles
  • Recommends optimum choices
persons qualifying as destination visitors
Persons Qualifying as Destination Visitors
  • UNWTO “visitors” who would not otherwise visit
  • Operating crews of public transportation conveying visitors to the area (e.g., flight attendants, pilots, motorcoach drivers)
persons qualifying as event visitors
Persons Qualifying as Event Visitors
  • UNWTO “visitors”
  • Nonresident producers of the event
  • Nonresident sponsors of the event
  • Nonresident media representatives covering the event
  • Nonresident vendors at the event
  • Future visitors
  • Pseudo visitors
some researchers exclude the following as violating the relevance principle
Some Researchers Exclude the Following as Violating the Relevance Principle
  • “Casuals” – visitors in the study area for some reason other than the event
  • “Time-switchers” – visitors who had been planning to visit the study area but changed the timing of their visit to attend the event
visitor expenditure estimation methods
Visitor Expenditure Estimation Methods
  • Direct observation
  • Administrative records
  • Household surveys
  • Tourism establishment surveys
  • Visitor surveys
  • Central bank data
visitor expenditure estimation models
Visitor Expenditure Estimation Models
  • Expenditure ratio
  • Residual receipts
  • Supply side judgmental
  • Seasonal difference
  • Cost factor
the problem of package tours
The Problem of Package Tours
  • How can we validly distribute a single package tour purchase among
    • places visited and
    • expenditure categories?
  • Afflicts visitor and household survey methods.
  • UNWTO recommends surveys of relevant tour operators to discern these patterns.
conclusions destination visitor expenditures
Conclusions: Destination Visitor Expenditures
  • Relatively straightforward: ascertain
    • those subjects permanently residing outside the study area,
    • these visitors purchase/consume products in the study area, and
    • these visitors do so during the study time period.
  • Area exit surveys and cost factor models can satisfy the Principles.
conclusions event visitor expenditures
Conclusions: Event Visitor Expenditures
  • “Because of the uniqueness of special events, there is generally no viable substitute for visitor surveys.” (Getz 1994)
  • Interview visitor samples as they leave the venue
  • Exclude those in area for other purposes (“casuals”)
  • Ask about spending over previous 24-hour period and expected length of stay in area
  • Employ best practices of probability sample survey design and conduct.
more conclusions event visitor expenditures
More Conclusions: Event Visitor Expenditures
  • Supplement visitor survey with surveys of –
    • Nonresident producers of the event
    • Nonresident sponsors of the event
    • Nonresident media covering the event
    • Nonresident vendors, booth holders and players
  • Ignore time switchers, future visitors and pseudo visitors