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Competitive Structure of Accommodations in a Traditional Japanese Hot Springs Tourism Area

Author

Listed:
  • Shohei Kurata

    (Department of Agribusiness Management, Tokyo University of Agriculture, Tokyo 156-8502, Japan)

  • Yasuo Ohe

    (Department of Agribusiness Management, Tokyo University of Agriculture, Tokyo 156-8502, Japan)

Abstract

This paper investigates the competitive structure of prices in a traditional hot springs resort area in Japan from a spatial econometric perspective. This perspective has not been addressed in hot springs—or “onsen” in Japanese—tourism areas, which have been gradually losing momentum due to the ageing of operators and diversification of leisure activities. The study area is one of the three oldest hot springs in Japan, the Dogo Onsen area in Matsuyama, where hotels and ryokans are clustered. First, we present a conceptual framework that characterizes two strategies, namely, differentiation and partnership strategies. Then, spatial error models are employed to test the hypothesis that spatial closeness intensifies price competition, while social closeness mitigates price competition. The estimation results reveal that our hypothesis was verified, in that the social network which has been nurtured for generations in the study hot spring area mitigates price competition, in comparison with the non-hot spring area in Matsuyama. Thus, good partnerships among local operators based on social networks should be more closely scrutinized for the revitalization of traditional hot springs areas.

Suggested Citation

  • Shohei Kurata & Yasuo Ohe, 2020. "Competitive Structure of Accommodations in a Traditional Japanese Hot Springs Tourism Area," Sustainability, MDPI, vol. 12(7), pages 1-15, April.
  • Handle: RePEc:gam:jsusta:v:12:y:2020:i:7:p:3062-:d:344027
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    References listed on IDEAS

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    Cited by:

    1. Lihua Liu & Yuping Chen & Wei Li & Yanfang Zeng & Mingshui Lin, 2023. "Research on Industry Transformation Models and Influencing Factors of Hot Spring Villages from the Perspective of Sustainable Development: A Case Study of Fujian, China," Sustainability, MDPI, vol. 15(13), pages 1-19, June.

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