Determinants of international tourism

LECTURE NOTES 3DETERMINANTS OF INTERNATIONAL TOURISMThe determinants of international tourism are factors which, with respect to the international exchange of tourism services, continually influence the position of each country in the international division of labor. Basing the study of determinants on an empirical analysis of international tourism trends (as previously discussed) helps to explain the mechanism of international tourism.

The economic study of international tourism determinants is based on a theoretical method of analysis. For this purpose, economic theories, such as the theory of international specialization are very effective. Four determinants, based on theories of international trade, explain the position of a country in international tourism exchange.

the theory of factor endowments

the theory of comparative costs

the theory of absolute advantage and technology

the theory of conditions of demand Even if demand is the main determinant of international tourism, it must be examined in conjunction with conditions of supply (factor endowments, comparative costs, absolute advantage) in the destination country, in order to explain international tourism flows comprehensively.

While theories of supply are often criticized in international commerce, they play a central role in international tourism. These four determinants can, to a large extent, explain the international distribution and trends of tourism flows. 1. demand as a determinant of international tourism is influenced by: endogenous factors - that generate tourism flows: income, free time, motivations

exogenous factors - factors that shape tourism flows: cost prices, exchange rate, demographic changes, technical progress, politics, sustainable development, health protection, HR development, changing consumer tastes, the emergence of new destinations2. offer as a determinant of international tourism is influenced by factors like: land, tourism services and facilities, prices, economic policy and the state.DEMAND AS A DETERMINANT OF INTERNATIONAL TOURISMTourism demand is represented by all persons that express their willingness to travel periodically and temporarily outside their usual environment for other reasons than the exercise of an activity remunerated from within the place visited.

Tourism consumption is represented by all the expenses generated by tourism demand for goods and services related to tourism.Tourism demand emerges at the tourists place of residence and bears the economic, ethnic, social, political, natural, cultural characteristics specific to that place.

Tourism consumption takes place in several stages:

before departure towards the destination, but in relation to it

while traveling towards the destination

at the destination while returning from the destination.

Tourism consumption is opaque and volatile because:

it is conditioned by a wide array of heterogeneous factors

is it influenced by a diversity of motivations

has a dynamic character

is concentrated in the developed countries

is it unequally distributed in time and space, due to seasonality and the rigidity of tourism offer, as well as to factors like labor conditions, psycho-social and cultural factors.

How are international tourism flows generated and what determines their direction?

Tourism demand in the importing countries is what generates tourism flows through the movement of consumers towards the exporting countries. Consumers are the ones that play the active role in generating tourism flows, while the producers are assuming more of a passive role.

Tourism import generally takes place under the following circumstances: the type of imported tourism is complementing the similar domestic offer, for the domestic demand that remains uncovered;

internal conditions in the importing country are not suitable for efficiently producing the necessary offer to cover domestic tourism demand

the domestic demand is interested in a complementary and different type of tourism than the one available on the domestic market;

the domestic offer, characterized by high quality and prices is exported, while for satisfying the domestic demand tourism is imported.

It is worth emphasizing that countries do not tolerate or encourage tourism import in case of lack of necessary foreign exchange for this type of discretionary consumption that could be satisfied from domestic demand. That explains why the most important tourism importers are developed countries, that are, in the same time, major tourism exporters.

The theory of demandDemand theories explain the reasons behind both the development and the intensity of tourism flows between countries. Tourism demand represents the quantity of goods and services that consumers require at a given moment. It is a direct function of per capita income as well as the populations interest in international tourism.The theory of demand describes the international specialization of countries with respect to internal, regional and international demand. It also describes the international distribution of tourism flows and the importance of tourism in national economies.

The theory of demand was formulated by Linder (1961). Linder noticed that the difference in the level of factor endowments between countries did not always reflect international exchanges. Indeed, often the greatest number of exchanges are between economies which have similar factors. For instance, in Europe, the more important tourism exchanges are between neighboring countries. This observation led Linder to develop a new theory of international exchanges based on interior demand or representative demand. Also, according to Linder, the international specialization of a country depends on a high level of domestic demand. In the main tourism receptor countries (France, US, Spain, Germany, Switzerland, UK), international tourism demand complements a domestic demand which is very high. In fact, the development of international tourism is a result of the conditions created by domestic demand. A countrys comparative advantage stems from the quality of its infrastructure and superstructure and also from its tourism know-how, its level of technology and its favorable environment.

Therefore, the volume of international tourism will be greater between countries which have similar domestic tourism structures. Would this means that the more similar the countries are, the greater their tourism exchanges? This question is central to the theoretical analysis of demand, because in addition to the quantitative aspect, another basis of international exchange is a demand for difference between partner countries.

International exchanges depend on both the volume of demand and the differentiation of the products. Even if products are similar, there will always be a difference in quality or brand which will prompt an international exchange. The demand for difference is particularly significant in international tourism and is based on geographical, cultural and linguistic differences which induce exchanges between neighboring countries with similar levels of economic development. Consequently, geographically close countries with resources that are relatively similar will benefit from greater tourism flow exchanges than countries with quite different resources which are located far from each other, although tourism flows will only occur between countries with similar resources if the tastes of the consumers differ, however slightly.Demand not only explains the cause of international tourism but also its intensity.

The volume of international exchanges will be greater between countries which also have a high level of domestic tourism and a similar structure. The volume of international tourism is greater and increases faster in geographical areas comprising developed countries with higher spending power. Conditions (determinants) of tourism demand

Factors that generate tourism demand endogenous factors: 1. MOTIVATIONS

2. INCOME

3. FREE TIME / LEISURE TIME1. MOTIVATIONS

The fundamental questions in tourism studies are related to the reasons why people travel and why they travel to certain destinations and seek out certain types of environment.

Kotler identifies three stages in what he calls need arousal:1. external or internal stimulation triggers a predisposition to some product class

2. considering needs that can be met through purchase of an item in the product class

3. these recognized needs activate wants.1.) triggering factors

Internal stimuli that can trigger the desire to travel > recognition of something lacking in everyday life.

External stimuli > advertising, conversations with acquaintances.2.) needs

Needs are not determined through triggering factors. They are aroused and activated.

Maslow: - wanted to segment people according to the needs that everybody shared.

- wanted to explain human behavior and what motivates people.

- found that needs must be satisfied in an order of priority.Using Maslows Hierarchy of Needs we can design tourism products for different needs1. Physiological and safety

food, water, job, home, freedom from threat or danger market segments that are focused on food, shelter are not significant markets for tourism. 2. Belongingness

love, friendship, affiliation, and group acceptance

products: group tours, tours to explore ones heritage

3. Esteem

status, self-respect and success, reputation, recognition, prestige products: status destinations, fad activities, 1st class air

4. Self-actualization

self-fulfillment, realizing ones potential products: educational tours, learning about cultures and languages

3.) Wants

Once needs have been triggered by some stimuli, wants become identifiable. Needs are not product-specific. They can be fulfilled in many different ways.

Wants can be satisfied by the attributes inherent to a specific product class.

From a tourism development perspective, understanding needs fulfilled by tourism is insufficient for developing product image and destination attributes. Want fulfillment may be a more important factor in the decision process. The best approach to understanding wants is to examine motives, which are expression of wants.

4) Motives

Literature on tourism often conceptualizes tourist motives in terms of push and pull forces. The idea behind this concept is that people travel because they are pushed by their own internal forces and pulled by external forces of the destination attributes. One way to realize travel motivation is to examine the notion of push and pull demand stimulation. The finding indicated nine push factors (cultural value, utilitarian, knowledge, social, economical, family togetherness, interest, relaxation, and convenience of facilities) and nine pull factors (safety, activity, beach sports/activities, nature/outdoor, historical/cultural, religious, budget, leisure, and upscale).

The push factors for a vacation are socio-psychological motives. The pull factors are motives aroused by the destination rather than emerging exclusively from within the traveler himself. This latter category of motives is termed "cultural". These motives reflected the influence of the destination in arousing them. Traditionally, push motives have been thought useful for explaining the desire to go on a vacation, while pull motives have been thought useful for explaining the choice of destination. Push factors generally associated with the desire of the tourist to escape from his everyday environment; direct link with work; can be satisfied by any destination on the market

Pull factors higher level of education; can be satisfied only by a specific destination they wish to see related to regions with important competitive advantages.For example, Dann (1977) states: While a specific resort may hold a number of attractions for the potential tourist, his actual decision to visit such a destination is consequent on his prior need for travel. An examination of "push" factors is thus logically, and often temporally antecedent to that of "pull" factors.

Prominent among the "pull" studies is the work reported by Williams and Zelinski (1970). They studied international tourism flows and partially explained these flows by the term "heliotropic."

Gray (1970) suggested a synonymous term "sunlust" which may be a more descriptive term referring to the same phenomenon. Sunlust characterizes vacations which are motivated by the desire to experience different or better amenities for a specific purpose than are available in the environment in which one normally lives. It is prominent with particular activities such as sports, and literally occurs with the search for the sun. Williams and Zelinski (1970) effectively define this phenomenon when they state:

Specifically in those cases where Country B offers singly or in combination contrasting or desirable climatic characteristics, scenic attractions, cultural and historical features, sports, shopping facilities, night life, and so on, either missing or in short supply in Country A, one might expect a significantly high flow from A to B.

Gray (1970) suggested that an alternate appeal to sunlust, that destinations may satisfy, is wonderlust. He defined wonderlust as: that basic trait in human nature that causes some individuals to want to experience different existing cultures and places, or the relics of past cultures in places famous for their historical associations, ruins and monuments.Recently, a third category has been added wanderlust including a combination of the two previous classes of motives and referring specifically to tours and circuits.There are different types of tourist motivations classifications. According to Middleton (1994), motivations to travel can be grouped as follows:

Business/work related

Physical/physiological motives

Culture/psychological/personal education motives

Social/interpersonal and ethics motives

Entertainment/amusement/pleasure motives

Religious motives

Cohen & Taylor, Mathieson & Wall, as well as Crompton identified, following a series of extended interviews, 11 socio-psychological motives which served to direct pleasure vacation behavior. These motives were:

1. Escape from a Perceived Mundane Environment

Refers to a temporary change of environment. Even the most prized living environments sometimes became mundane to those living there.

- the most frequent; the largest market segment

- the further from home, the betterTourism promotion emphasizes on the desire to escape, to relax

2. Exploration and Evaluation of Self A pleasure vacation may be viewed by some people as an opportunity for re-evaluating and discovering more about themselves or for acting out self-images and in so doing refining or modifying them.

Self-discovery emerges as a result of transposition into a new situation. The novelty of the physical and social context appear to be an essential ingredient in the process. These insights into the person's self could not be achieved by staying at home or visiting friends and relatives.

very complex, highly spiritual

religious tourism, pilgrimages & rural environments

3. Relaxation The term relaxation is often ambivalent and refers to a mental state rather than a physical relaxation. Tourists often say that they felt relaxed during their vacations and then admit that they came home physically exhausted. Given this interpretation it was possible to reconcile physical exhaustion or fatigue as being mentally refreshing and relaxing.

Specific offer for this motivation spa and health tourism

Self-preservation need, recharging ones batteries

4. PrestigeAlthough prestige still is a primary motivating factor in some people's trips, few tourists accept that there was any prestige motive involved in their own pleasure vacation decisions. It may be that as travel has become more frequent, it is perceived to be less prestigious. Travel may have become part of the indigenous life style rather than symbolic of a higher life style. Prestige potential disappears with frequency of exposure.

Certain destinations serve this purpose Paris, London, NY5. Regression

Vacation provides an opportunity to do things which are inconceivable within the context of the usual life styles. The things tourists do are often puerile, irrational, and more reminiscent of adolescent or child behavior than mature adult behavior. The opportunity to engage in this behavior is facilitated by withdrawal from usual role obligations. On vacation, tourists are freed of the mores that inhibit capacity for this type of enjoyment.

Complex offer theme parks

Intensive in capital investment, technology efficient only if there is high demand

Very dynamic form of tourism, high prices with similar revenues

Gambling tourism risk taking, need to play Eastern Coast Atlantic City, Las VegasImportant for countries that do not have natural resources.6. Enhancement of Kinship Relationships

Many tourists perceive the pleasure vacation as a time when family members are brought close together. Hence, the pleasure vacation serves as a medium through which family relationships could be enhanced or enriched. This enhancement is often facilitated by long drives in an automobile because family members are physically juxtaposed for long periods and forced to interact with each other. What is different is the act that you are together as a family. You are able to put aside the other kinds of responsibilities that each of you may have that would otherwise be impinging themselves upon that notion of focusing inwards and putting things together.

Ethnic tourism

- melting pot discovering and following own ethic roots

7. Facilitation of Social Interaction to meet new people in different locations. These trips are people oriented rather than place oriented. Like several of the other motives which are located towards the socio-psychological end of the disequilibrium continuum, tourists often become aware of this motive only after the trip was completed

frustration coming from isolation 8. Sexual motivation specific case of 7

- implicit commercial with a couple on the beach or a beautiful girl romantic relationship

- explicit destinations with low moral barriers applicable to foreign tourists Thailand, Asia

- tolerated type of tourism

9. Economic

- shopping tourism cheaper goods Asia, Andorra- survival tourism decreasing income forces people to move their residency towards areas where they can have a similar living standard, with lower costs

Cultural Motives

Motives located towards this end of the continuum (Figure 1) are concerned with the destination rather than with the social and psychological status of the individual.

Two primary cultural motives were identified. They are novelty and education. These may be related, since exposure to new destinations, sights, and experiences is presumably educational.

10. Novelty dreams coming trueNovelty is defined by tourists in a variety of ways. Synonyms included curiosity, adventure, new and different. Novel means new experience but it does not necessarily mean entirely new knowledge. Often tourists know a lot about a place. The novelty results from actually seeing something rather than simply knowing of it vicariously.A preference for going to a previously unvisited destination is a consistent factor.

Cultural disequilibrium appears to be an on-going state which requires a supply of fresh cultural stimuli to restore homeostasis.Incentive travel adapted to tourist demands tailor-made packages

11. Education

The sense of "ought" to see and experience a particular place frequently means that circumstances, especially present location, is the trigger which initiates selection of a destination. Cultural disequilibrium is not site or destination specific. It does not relate to one particular place, but it is generally applicable to all places

CONCLUSIONS AND IMPLICATIONS

Delineation of underlying motives offers useful insights into understanding the destination selection decision process. All else equal, preference is likely to be given to a destination which is perceived as most likely to service the dominant motive. For ease of exposition, the motives were discussed as separate entities. However, they should not be considered as mutually exclusive, nor should any single tension state be selected as the determinant of behavior. They operate in tandem or combinations, for motives are multidimensional.

Thus, destination decisions are usually energized by several motives acting in tandem.

There appear to be two directions which could usefully be pursued profitably by the tourist industry if it accepts the significance and role of socio-psychological tension states in pleasure vacation decisions. First, efforts are required to arouse people's awareness of their own real motives.

The second direction lies in the development of the destination product and its promotion.

The motives may be used as a basis for market segmentation. They provide cues and insights around which destinations can develop and promote their product to target segments.

2. INCOME

In economic theory, the demand for a product varies with the income, its price, the price of other goods, taxes, interests etc. Usually, demand follows the variation of the income and is opposing the variation of prices.

Tourism demand is nonconforming. Witt and Martin (1987) claim that income is the only factor that might explain tourism demand variation only in about 38-39 %, with huge differences from one nationality to another.

An increase in income will determine a rise in international tourism demand, especially for countries where the demand for international tourism is not saturated.

An increase in prices will not determine a decline in demand because tourism demand and especially tourism consumption are easily adaptable:

travel to closer destinations shorter distance

shorter length of stay

simpler tourism products

A fall in income will not determine a fall in demand, but changes in demand similar to the ones due to increase in prices

A fall in prices will determine a rapid increase in demand because it opens new opportunities for those refraining from international tourism consumption, limiting them to domestic tourism.

Tourism demand:

increases with an increase in income and does not decrease with the increase in prices

does not decrease with the decrease in income and increases with a decrease in price In analyzing the connection between income and tourism demand a better approach would be to study the discretionary income not gross income related to tourism expenses:

Et = f(Ydis) = f ([ ( Ya) - ( Eb), S ](

Ya = f( Y-T )

Eb = f(P1....n, I)

Et = expenses for tourism

Ydis = discretionary income

Ya = available income

Eb = expenses for non-leisure items

S = savings

Y = gross income

T = taxes

P1...n = prices of non-leisure items

I = interest rate

The effect of inflationary pressure, cost of transport, price of substitute goods should also be considered.

Conclusion: only the economic factors dynamic cannot anticipate the variation of tourism demand

3. FREE TIME

Free time is in continuous increase (increase of life expectation, decrease of working life, demographic changes). If this increase in not accompanied by a similar increase in discretionary income, its effect on free time consumption will be low.

The proportion tourism consumption consumption of other activities is determined by:

the attraction of a leisure activity that competes with tourism: a trendy hobby that offers higher satisfaction

decreasing marginal utility lower satisfaction for each supplementary unit consumed

changing ratio - usual environment less stressful and tourism environment more stressful

Types of free time:

at the end of the day

at the end of the week

vacation

from the beginning of life until the beginning of active life and from the end of active life till the end of life

Determined by:

- economic factors

labor laws

labor productivity

- cultural factors

ratio tourism/work =% change in allocation of time for tourism consumption (TT)

% change in allocation of time for work(TW)

ratio tourism/free time = % (TT) % change in allocation of time for other leisure activities

(TW-TT)

- From a certain level (obtained through increased labor productivity and social progress) the first indicator determines changes of the second one.

- The second indicator can also be modified based on decreasing satisfaction obtained for each supplementary unit of tourism consumption experienced (marginal utility)

- Both indicators are influenced by the qualitative relationship between tourism consumption and work as perceived by the tourist.

Tourism and workWork provides a means for tourism and often work also provides the motivation for tourism.

Whatever the balance, leisure, tourism and work are inseparable.

However, as Parker (1983) argues, by and large, leisure and work are competitors for our time, a feature also examined by Roberts (1999). If one increases then the other decreases. The nature of work, though, is an important influence on tourism not just in terms of competition for time though.

Where an individual's work is boring, arduous or monotonous, tourism may well represent an escape. Opposing this, some are fortunate to find their work exciting, enjoyable and possibly difficult to disassociate from their leisure. Here a holiday may be seen as a means to extend one's work

Zuzanek and Mannell (1983) identified four hypotheses in terms of a work/leisure relationship:

The Trade-off Hypothesis - work and leisure are competitors for time and an individual chooses between them:

more you work more income you have, but less time

less you work, less income you have, more free time

Aim perfect proportion between work and free time maximum satisfaction for minimum income

The Compensation Hypothesis - leisure and holidays compensate for the boredom and troubles associated with work and everyday life

The Spin-off Hypothesis - where the nature of an individual's work produces a similar pattern of leisure activities. Passive work calls for a passive vacation

The Neutralist Hypothesis - where there is no discernible relationship between leisure and work. Work is a marginal life experience. Free time is an expression of an individual needs and has nothing to do with work.

What can be seen here is that in the vast majority of cases different types of work produce different levels of satisfaction, which in turn influences individual needs and wants and hence leisure and tourism motivations. Factors that shape tourism demand: exogenous/ external factors that affect tourism

To acquire a deeper understanding of tourism and to better facilitate tourism planning, a number of external factors which may have the ability to shape tourism demand or to negatively impact the development of tourism must be considered.

Factors confronting global, regional and domestic tourism which have the potential to greatly influence tourism growth include: costs/prices, distance, exchange rates, socio-demographic change, technological advances, political change, sustainable tourism and environmental issues, safety and health issues, and human resource development.

4. Costs/Prices

Tourism demand is a function of prices, which are a function of costs:

Cost of transport 30-50%

Cost of accommodation + F&B (food and beverages) 40-50%

Cost of different activities at destination / attractions 20-30%

Cost of transport is related to distance / space:

it is the most important cost, representing about 40% of the overall tourist expenses

it is dependant on the cost of gasoline, administrative costs, objective (actual) distance and subjective (cognitive) distance

it is defined not only through economic indicators, but also in psychological terms

Subjective/cognitive distance = distance perceived by the tourist depending on the means of transport chosen, convenience, speed, possibly entertainment envisaged

Psychological distance the way the tourist perceives the space that separates him from the destination

Cognitive distance is a mental representation of actual distance molded by an individuals social, cultural and general life experiences

Error in cognitive distance estimates by tourists will result in false perceptions being used in their decision making process:

Overestimation of distance by tourists can lead to a perception of inflated costs, extended travel time and increased risk, all of which decrease the likelihood of travel.

Underestimation of distance by tourists will initially increase the attractiveness of the destination, and increase the likelihood of travel. However, underestimation can be problematic if this leads to unrealistic expectations of a destination. When the tourists experience does not equate with those expectations, dissatisfaction may result (Ankomah and Crompton 1992).

Indeed when distance and travel time are regarded as important factors within the choice of a destination, this dissatisfaction may be amplified and the likelihood of negative word of mouth being passed on to other potential travelers is increased.

We are therefore confronted with a conundrum.

On the one hand, the literature suggests that the attractiveness of a destination increases with distance.

However, on the other hand, the factors that contribute to the "friction of distance" (Mayo, Jarvis and Xander 1988), which operate to deter the act of traveling, have been suggested as also increasing with this distance.

The relationship between the distance to the destination and desire to travel to that destination is further distorted by the notion that, as pointed out by Ankomah and Crompton (1992, p.324), "subjective distance rather than actual distance may best depict what goes on in individuals' minds when they are making travel decisions".

Ct = f( F, O, Da) + f( R)

Dc = f [ (] = f [(p, t, 1/v, 1/(,1/ ()+ f(P)]

TD = f(Ct, Dc)

Accessibility = Da + Dc + P

Ct = cost of transport

F = cost of fuel

O = other costs including administrative costs

R = profit margin of transport companies

Da = actual distance

Dc = cognitive distance

( = mean of transport

p = price

t = time for transport

v = speed

( = comfort, low effort

( = entertainment

TD = demand for transport

P = permeability

Permeability refers to the destination tourism openness, trade openness, taxes on international tourism, political situation, stability, visa requirements, cultural proximity.

Distance can be amplified or diminished by specific perceptions like:

gravity attracts tourists to a certain destination that seems closer than in reality due to its attractiveness.

friction of distance amplifies distances because it creates difficulties to travel, destinations are perceived as being farther than in reality

inertia to initiate a trip force opposing any type of trip, no matter at what distance

inertia to traveling reduces the effect of the friction of distance

marginal distance threshold stimulates travel - beyond a certain distance each unit of space is perceived as shorter

periphery attraction stimulates long haul travel to peripheral destinations

5. Exchange Rates

Exchange rates are also a factor that might be influencing the direction of tourism flows.

If we consider two countries A and B with tourism flows among them, from A (importing country) to B (exporting country), we have the following situation:

- travel agents from A will sell here tourism products from B, for which they will obtain from tourists the importing country currency. Between the moment of purchase of the tourism package and the actual moment of consumption there might be a fluctuation in the exchange rate currency A/currency B. When travel agents from A will actually pay for tourists consumption in B (different moment than the one for cashing the money from tourists), there will be a difference in the exchange rate, that can lead to profit or loss.

- tourists can also be influenced by fluctuations in the exchange rate in their currency is appreciating as compared to the exporting country one, for example, then they might increase their consumption (volume or value) or length of stay. Travel agents will start promoting that destination.

This way, exporting countries can use exchange rates to promote tourism (by depreciating it) and importing countries can use the same system to raise barriers to tourism import.

6. Changing Demographics

An important factor is the changing demographic profile of the worlds population. In light of the over six billion people populating our planet, tourism product development and service delivery for the years ahead require the anticipation of demographic changes. 3 well-defined groups of travelers, each distinct in its travel consumption and preferences, will be evident.

The largest group, the 18-34 year olds, will continue to comprise much of the traveling public as singles or in groups. Whether traveling alone, with coworkers or with a group of friends, this age segment will continue to dominate much of the Asian outbound market.

In developed western countries and Japan, however, the fastest growing population segments will be over the age of 50/60. Many will be early retirees due to the restructured job market of recent years. These baby boomers will have the financial resources and discretionary time to travel. However, their spending patterns will be quite mixed depending upon their retirement incomes. Longer visitor stays and greater overall visitor expenditures are expected from this group, who will be seeking physical adventure, intellectual enrichment and culturally rich destinations.

Finally, the family market will also be visible as families with children and two income households continue to increase. Travel will be used to provide quality time for parents and their children, resulting in greater demand for family-oriented attractions, facilities, and accommodations. Family structures, too, will change worldwide with the rising numbers of working women, single households, childless couples and non-traditional families. All have enormous implications for planning tourism destinations.

7. Technological Advances

Technology continues to impact on the travel experience and those who use or supply it. In particular, the linkage and interdependency between transportation, travel distribution systems, and customer information is receiving increasing attention.

In aircraft development the technology is already available to transport passengers in a supersonic airplane from New York to Shanghai in under 3 hours, although it will be many years before economics make the technology feasible for marketplace adoption. The technology of high speed trains able to reach speeds in excess of 483 kmh (300 mph) are already in use in Japan, France and other parts of the world, and could become a preferred alternative to air travel as airport congestion and delays increase. Although train travel for pleasure has been growing in popularity in the U.S., it seldom receives adequate attention as a viable mode of transportation in tourism because of economic factors and withdrawal of public subsidies.

Technology can be an ally, but also a threat. While new developments in technology can improve tourism services and product delivery, technology can also mean customer loss, job displacement, underemployment and a resulting negative impact on a local economy.

Already the new generation of long-haul, fuel-efficient aircraft means the ability to overfly virtually any destination. Unless a destination can generate sufficient demand for air seats, the future of adequate air service to that destination may be in jeopardy.

The services provided by airline computerized reservation systems (CRS) and telephone and cable companies, combined with the growth of electronic highways and on-line services, are dramatically altering the way travel products are marketed and distributed. Accessible and user-friendly global distribution systems (GDS), accessed by millions of individuals throughout the world, have the ability to do what the travel agent or tour operator has traditionally done: to create a vacation package for the consumer that can be tailor-made by the customer.The convergence of the television, telephone and the personal computer will continue to create new distribution channels for reaching the customer directly. The growth of video conferencing and creation of virtual reality technologies will enable people miles apart from one another to communicate in a very real sense without leaving their offices, and without buying an airline ticket or needing a hotel room.

8. Political Change

We will continue to see political changes which will have strong effects on tourism. The emerging Eastern European countries and Central Independent States, slowly establishing democratic governments and free market economies, are gradually having an impact on that region of the worlds travel trends. The impact of Chinawith its population over 1 billionas both an inbound, but more importantly, an outbound tourism market, attracts the interests of economists, business and government policy makers in neighboring countries and beyond.

9. Sustainable Tourism and the Environment

As tourism reaches maturity as an industry in many countries around the world, the question is one of sustainability. The term sustainable tourism is a relatively recent one with different meanings and interpretations. Sustainable tourism deals with the ability of a destination to remain competitive against newer, less explored destinations; to attract first time visitors as well as repeaters; to remain culturally unique; and to be in balance with the environment.

With the projected tourism arrivals figure of 1 billion by the year 2010, the potential strain on beaches, mountain resorts, historical city centers and small rural villages could leave their existence in peril. Accepting and implementing limits on tourism development is one way to counteract the potential overuse and exploitation of a destinations natural resources and cultural heritage.

Environmental problems such as global climate changes, ozone loss, deforestation, and toxic wastes promise to stay at the top of the international agenda. The tourism industry will see the continued need to combine sound economic development with the protection of natural resources. There will be an increasing need to analyze the trade-offs between native cultural integrity and the benefits of employment, and the need to understand the impact of rapid climatic changes on prime vacations sites, such as coast lines.

Even ecotourism is not without its detractors. Ecotourism started out as a low-impact offshoot of the adventure travel industry. It represented the best intentions of an educated and affluent middle class to travel without despoiling the environment. However, the very presence of tourists can still threaten the fragile ecology of such areas as the Antarctic, tropical rain forests, or island destinations anywhere.

The World Tourism Organization, the World Travel and Tourism Council, and the Pacific Asia Travel Association are among the many international and regional organizations to develop policies, codes, and guidelines regarding conservation and protection of natural resources.

Every segment of the industry has been enlisted to support the environment movement. Lately, the hotel industry has moved aggressively in combating waste in the use of water and energy, reducing the use of hazardous chemicals in laundry and ground maintenance, and in recycling high use consumable materials, such as soap, paper goods, and plastic amenities in guest rooms.

10. Safety and Health

Health as well as security concerns are of major interest for international travelers. The reemergence of diseases such as cholera and malaria in developing countries, as well as the global threat of the AIDS virus, is making travelers more concerned with the sanitation standards applied to food, water, and medical supplies, and with human behavior and preventative measures practiced by host destinations.

Safety has always been an important prerequisite for the attraction of international visitors. According to a 1994 survey, 66 percent of leisure travelers said crime is an important consideration in choosing a vacation destination, and 62 percent of travelers considering overseas travel had safety concerns as they made their plans (World Travel and Tourism Council, 1995).

While the statistical odds of being harmed as a visitor are insignificant compared to injury from ordinary accidents, the publicity which follows the wrongful death of a tourist makes for sensational anecdotal stories and headline news around the world. As tourism grows, security becomes more important and travelers will expect safeguarding measures in transportation and accommodations while visiting foreign countries. The threat of international conflicts and wars, growing levels of crime, and terrorism not only deter tourism, but often place countries at political odds when they must issue travel advisories against otherwise friendly countries.

Some countries possess the resources to handle security issues as they relate to tourists quite effectively. However, aviation safety problems continue to plague many countries as the rapid growth in airline service puts a severe strain on the countries aviation infrastructure, and are further exacerbated by personnel shortages and lack of experienced pilots, flight and ground crew.

11. Human Resource Development

The travel and tourism industry continues to be a major source of employment in both affluent and poor countries, employing one out of every nine workers worldwide. Because of slowed population growth rate in industrialized countries, however, some nations will have to search for workers, including the importation of expatriates, and initiate work re-engineering for service industries. The lack of available workers will become especially hard-felt as populations continue to age.

Developing countries, by contrast, will be faced with burgeoning youth populations in need of work but without the necessary skills. The shortage of entry-level and skilled workers, plus the increased consumer demand for improved services, will pressure the industry to provide more education and training and greater incentives to work in the tourism sector.

Some countries actively pursue human resource planning for tourism enterprises. Hospitality and tourism training and education have undergone rapid development in most countries which heavily rely on the visitor industry for revenues.

Secondary schools provide training for students desiring semi-skilled, entry-level hotel and restaurant jobs. Post-secondary vocational programs offer special skill training for students interested in becoming supervisors or professional chefs. Higher education offers different programs at varying levels, including two-year certificate and diploma programs, as well as four-year Bachelors and Masters degrees.

Tourism Market Trends

Unlike some of the external factors which can have negative affects on tourism if not addressed early or quickly reversed, trends represent developments or social movements that foreshadow what will happen in the future. Since a true trend is impossible to change, planners must anticipate it and determine a suitable course of action. The following represent a few of the top tourism trends which are having significant impacts on the tourism industry worldwide.

1. Changing Consumer Preferences

Todays pleasure to business travel mix is approximately 70 percent/vs. 30 percent, a reversal of the trend prevailing in earlier decades which favored business travel. While business travel is expected to remain important due to the development of Eastern Europe and resource-rich South East Asian countries such as Malaysia and Indonesia, most of the growth will derive from pleasure traffic.

Paid holidays, while common in developed countries, are not yet universal, but are increasingly seen as an entitlement, as an integral component of ones lifestyle, and as an antidote to stress from overwork. For example, the Japanese government and industry are encouraging a policy of jitan or shortening work hours, with a goal of 1,800 hours or less for the average worker in a year. This translates into seven weeks of available time for leisure and travel.

The industry is seeing both a rise in length of stay, particularly from the older, affluent vacationers with discretionary time, as well as an increase in shorter holidays by the younger work force that want to catch their breath and take two- or three-night extended weekend getaways from the stressful urban pace.

2. Product Development and Competition

New tourism destinations are rapidly emerging in the world. These include Vietnam, Cambodia, and Laos in Asia; the Central Republics of the former USSR; Chile in Latin America; and Southern African nations. In recent years, Vietnam has been particularly aggressive in seeking foreign expertise and investments for tourism. Even Japanthe Asian regions most important tourist generating countryis beginning to stress the importance of a two-way flow of tourists. Some of these destinations already boast a high standard of service. Most of them also possess aggressive government assistance and incentive for tourism development and varied attraction resources, which bode extremely well for their potential success. For the more established destinations, however, these new destinations represent competition for regional and international travelers.

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