![]()
Tourism Demand Modeling and Forecasting: A Review of Literature Related to Greater China
GANG LI
Greater China, including Mainland China, Hong Kong, Macau, and Taiwan, contributes significantly to both regional and global tourism developments. Empirical research on tourism demand modeling and forecasting has attracted increasing attention of scholars both within and beyond this region. One hundred eighty articles are identified that were published in both English- and Chinese-language journals since the beginning of the 1990s. This study presents the largest scale of literature survey on tourism demand studies. Furthermore, this is the first attempt in tourism demand review studies that focuses exclusively on one geographic region and covers bilingual literature. Particular emphasis of this review is placed on research development, geographic focus, data type and frequency, measurement of tourism demand, modeling and forecasting techniques, demand elasticity analysis, forecasting exercises, and emerging research trends. Comparisons between the two bodies of literature published in two languages show a number of research gaps, such as the diversity and sophistication of the research methodology, rigor of the modeling and forecasting process, and theoretical foundations of demand analysis. Correspondingly, constructive recommendations are made to further advance tourism demand studies related to Greater China.
Introduction
Modeling the effects of various factors on tourism demand and forecasting the future trends are two major focuses of tourism demand studies (G. Li, Song, & Witt, 2005). The analysis of the effects of tourism demand determinants provides important information for formulating and evaluating tourism policies and strategies. Tourism demand forecasting serves the practitioners in both public and private sectors in a number of ways. Firstly, the success of many tourism businesses such as airlines, hotels, and tour operators depends largely on the state of tourism demand. Estimates of expected future demand constitute an important element in their planning activities, particularly given the perishable nature of tourism products. Secondly, tourism investment, especially in a destinationās infrastructure, requires long-term financial commitments, and the sunk costs can be very high if the investment projects fail to fulfill their design capacities. Therefore, the prediction of long-term demand for tourism-related infrastructure often forms an important part of project appraisal (Frechtling, 2001). Thirdly, accurate forecasts of the scale and growth of tourism demand in a destination help the government decide on and implement appropriate medium- to long-term policies in order to achieve the sustainable tourism development.
Asia and the Pacific has been one of the fastest growing tourism regions in the world over the past decade and this trend will continue in the forthcoming decades (World Tourism Organization [UNWTO], 2000). Within this region, Greater China, including Mainland China, Hong Kong, Macau, and Taiwan, contributes most significantly to both regional and global tourism developments. According to the UNWTO (2008), tourist arrivals to Greater China reached 88.5 million in 2007, which accounted for almost half of the total in Asia and the Pacific and nearly one tenth of the world total tourist flows. In particular, Mainland China is the fourth most popular tourist destination in the world and it is predicted to reach the top by 2020 or even earlier (UNWTO, 2000). In addition to a fast growth of 9.2% in Mainland China, Macau obtained an even faster growth of 12.5%, and Hong Kong and Taiwan both gained higher than 5% growth rates, in terms of international tourist arrivals in 2007 against the previous year. Not only has Greater China become one of the most popular tourist destinations, it features as an active source market of international tourism. Mainland China, Hong Kong, and Taiwan appeared in the 6th, 14th and 22nd positions in the world, respectively, in terms of tourist spending in 2006.
The socioeconomic significance of the rapid tourism development in Greater China has inspired international scholarsā interests in researching the determinants and effects of the increasing tourism demand in this region and predicting the trends of future demand. According to the authorās literature search, more than 200 journal articles have been published since the early 1990s in either English or Chinese language, focusing on modeling and forecasting tourism demand for Greater China. Given the importance of tourism demand research and its rapid growth in this region, it is necessary to provide a comprehensive review of the existing studies. By summarizing similarities and dissimilarities of past st...
