This paper analyzes the responsiveness of Thai outbound tourism to East Asian destinations, namely China, Hong Kong, Japan, Taiwan and Korea, to changes in effective relative price of tourism, total real total tourism expenditure, and one-off events. The nonlinear and linear Almost Ideal Demand (AID) models are estimated using monthly data to identify the price competitiveness and interdependencies of tourism demand for competing destinations in both long run (static) and short run error correction (dynamic) specifications. Homogeneity and symmetry are imposed in the long run and short run AID models to estimate the elasticities. The income and price elasticities provide useful information for public and private tourism agents at the various destinations to maintain and improve price competitiveness. The empirical results show that price competitiveness is important for tourism demand for Japan, Korea and Hong Kong in the long run, and for Hong Kong and Taiwan in the short run.Keywords: Almost Ideal Demand (AID) model, tourism demand, price competitiveness, substitutes, budget shares, error correction.JEL classifications: C3, C5, D12, L83. 3 IntroductionThe contribution of tourism to economic growth and development has been well documented in the literature. In recent decades, tourism has become one of the world's largest and fastest growing sectors, and has many important economic roles, especially as a major earner of foreign exchange. Numerous attempts have been made to understand the key determinants of tourism demand, with the purpose of implementing appropriate policies and strategies to attract a greater number of international visitors. As a result, competition among tourist destinations has become intense.Price competitiveness is a major factor that could directly affect the attractiveness of a particular destination as changes in tourism prices influence the amount of tourist expenditure (Song and Witt, 2000). This indicator provides useful information that is important for developing pricing policies, planning and marketing strategies.Although Thailand is famous for inbound tourism, the rapidly rising income levels of Thai travellers during the last decade have also fueled a quest for visiting tourism destinations abroad.Overall, 85% of Thai tourism spending takes place in the Asia-Pacific region, with most trips being of one-week duration, and to a single destination. According to the Tourism Authority of Thailand statistical reports for 1996-2007, a high proportion of outbound Thai tourists travel to East Asia, which accounts for over 80% of Thai tourists (see Figure 1). (2010)), the number of outbound Thai travelers to all destinations in East Asia has increased consistently over the past few decades. The specific reduction in tourist activities was also reflected in a slowdown of outbound tourist traffic within the region, which had a negative impact on the overall Asian tourism environment. However, the reduction in Asian tourism recovered rapidly in the third and the fourth quarters of 2...