Application of Benford’s Law to the Tourism Demand: The Case of the Island of Sal, Cape Verde

Abstract

This article presents Benford's Law applied for the first time to the tourism context, focusing on tourism demand. This law states that in sets of random numbers of natural events, the probability of the first digit of these numbers being 1 is approximately 30%, of being 2 is 18%, and so on until reaching 9 with 4.6% probability. In this context, the objective is to verify if Benford's Law applies to the monthly numbers of overnight stays registered in the accommodation establishments of the Island of Sal, in the period between 2000 and 2018, to test the data reliability. This research focus on data provided by the National Statistics Institute of Cape Verde. The Chi-Square test (χ 2 ) was used to assess the discrepancy between the observed and expected relative frequencies. The results show that the observed χ 2 value is higher than the χ 2 critical value (5% significance level), meaning that the number of monthly overnight stays recorded in accommodation establishments on the Island of Sal does not follow Benford's Law. However, certain possible data disturbances must be considered, such as the occurrence of specific events during that time period. Other factors that could influence the results are the size of the data set and a sub notification in the data collection process. These circumstances may be the cause of the non-adaptation of the number of overnight stays to Benford's Law. The implication of this fact on the estimation of tourism demand is crucial for the development and optimization of prediction models.