Table of Contents

International Handbook on the Economics of Tourism

International Handbook on the Economics of Tourism

Elgar original reference

Edited by Larry Dwyer and Peter Forsyth

This highly accessible and comprehensive Handbook presents a cutting edge discussion of the state of tourism economics and its likely directions in future research. Leading researchers in the field explore a wide range of topics including: demand and forecasting, supply, transport, taxation and infrastructure, evaluation and application for policy-making. Each chapter includes a discussion of its relevance and importance to the tourism economics literature, an overview of its main contributions and themes, a critical evaluation of existing literature and an outline of issues for further conceptual and applied research.

Chapter 4: Structure Conduct Performance and Industrial Organisation in Tourism

Brian Davies and Paul Downward

Subjects: development studies, development economics, tourism, economics and finance, development economics, environmental economics, environment, environmental economics, tourism, geography, tourism


Brian Davies and Paul Downward Introduction Tourism is invariably referred to as the world’s largest industry.1 Yet it is also a risky business venture subject to a highly volatile business environment. Such volatility has been examined in terms of the influence of tourism demand.2 What has received little attention is the supply environment. Any analysis requires at least some discussion of the generality of competition involved. From a microeconomic perspective, the supply of tourism can be understood in terms of the models and concepts developed and refined in the structure conduct and performance paradigm (SCP) and, relatedly, the industrial organisation (IO) literatures. To provide a critical overview and assessment of the relevance of these concepts, and thus put forward a balanced insight into the main issues that the literature reveals is, in many respects, an ambition that cannot be adequately addressed in one chapter. On the one hand, the SCP and IO literature is immense. On the other, tourism is such a wide-ranging concept that it has yet to find one accepted definition, for example, in official statistics, so the definition of supply is accordingly fluid (Allin 2005). Facing up to these constraints, this chapter draws upon the authors’ previous research in the travel agency/tour operations business and hotels to provide what we feel are key issues that need further investigation and refinement, and which could have application to sectors other than those discussed. The next section begins the discussion by indicating the scale...

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