Internal and Locational Factors Affecting Hotel Industry Efficiency: Evidence from Italian Business Corporations

Abstract

This paper investigates whether and how the competitive delay of the Italian hotel industry is influenced by the level of business corporation efficiency. A stochastic frontier production approach is proposed in which technical inefficiency is specified as a function of the internal and locational factors in a firm. The model is estimated on a balanced panel of tourism business corporations observed during 1998–2005. Estimates show that the competitive gap in the Italian accommodation system is not a result of poor business corporation performance, and the importance of location, human and immaterial capital is assessed as (in)efficiency determinants. The authors then suggest policies to improve the Italian tourist industry's competitiveness.

Performance evaluation of the hotel industry in an emerging tourism destination: The case of Oman

“…The variable Attractions is introduced to investigate the influence of hotel's location on its efficiency. Bernini and Guizzardi (2010) suggest that location is positively correlated with technical efficiency, especially for sun and beach destinations, as well as cities with renowned cultural importance. Thus, resources that may contribute to the attractiveness of a hotel's location need to be conserved (Gomezelj & Mihali c, 2008).…”

“…In the hotel industry, examples of contextual factors include hotel size , location (Barros, 2005a;Bernini & Guizzardi, 2010;Tundis et al, 2012), and type of ownership (Barros & Dieke, 2008), which are found to be strong determinants of hotel efficiency in many case studies. Other variables could also be pertinent, like star rating (Assaf & Cvelbar, 2010), used essentially to reflect quality of service, even though it is far from being a wholly satisfactory proxy for such an operational factor (Oliveira, Pedro, & Marques, 2013).…”

Tourism economics research: A review and assessment

“…The empirical literature on tourism firm efficiency has been dominated by a non-parametric approach-the data envelopment analysis (DEA) (e.g., Barros & Alves, 2004;Chiang, Tsai, & Wang, 2004). The main advantages of DEA compared to the standard econometric technique are that it 1) does not require any form of functional specification and 2) is able to handle multiple inputs and outputs readily in any (in)efficiency theoretical paradigm (Bernini & Guizzardi, 2010). Based on the input and output data from DEA, a Malmquist Index can be constructed to measure productivity change.…”

Evolutional Model of Tourism Efficiency Based on the DEA Method: A Case Study of Cities in Guangdong Province, China

“…George Assaf (2012) uses the stochastic frontier analysis and DEA to evaluate and compare the tourism operators and hotels in the Asia-Pacific region. Bernini and Guizzardi (2010) use the DEA to study the efficiency and competitiveness of the Italian hotel industry. Assaf, Barros, and Josiassen (2010) and other analysts use DEA to evaluate the operation efficiencies of the hotels in Taiwan (Chen, Hu, & Liao, 2010;Cheng, Lu, & Chung, 2010;Chiu, Ting, & Huang, 2010;Hsieh & Lin, 2010;Hsieh, Wang, Huang, & Chen, 2010;Hu, Shieh, & Huang, 2009;Huang, Chiu, Ting, & Lin, 2011;Shang, Wang, & Hung, 2010;Ting & Huang, 2012;Wu, Liang, & Song, 2010;Wu & Song, 2011;Yu & Lee, 2009).…”