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The Internet and Seasonality: A Theoretical and Empirical Analysis of Vertically Differentiated Accommodation Structures

Author

Listed:
  • Federico Boffa

    (Department of Legal and Economic Studies, University of Macerata, Jesi Branch, Via Angeloni 3, 60035 Jesi (AN), Italy, and Institut d'Economia de Barcelona (IEB), Spain)

  • Marianna Succurro

    (Department of Economics, Statistics and Financial Sciences, University of Calabria, 87036 Rende (CS), Italy)

Abstract

The authors study the impact of online booking on seasonality across various types of accommodation. They first build a theoretical model on vertical differentiation and seasonality, and show that, if the impact of the Internet on search costs is homogenous for hotels with different quality levels, then the increase in seasonality as a result of ICT development is greater for low-quality accommodations. On the other hand, if the Internet is more spread among high-quality firms than among low-quality ones, then the Internet-induced increase in seasonality is larger for high-quality establishments. The paper's empirical analysis, which differentiates the impact of the Internet on seasonality between ‘hotels and similar establishments’ and ‘other types of accommodation’, finds that ICT has a positive effect on seasonality in both instances, but that the impact is quantitatively larger for ‘hotels and similar establishments’.

Suggested Citation

  • Federico Boffa & Marianna Succurro, 2013. "The Internet and Seasonality: A Theoretical and Empirical Analysis of Vertically Differentiated Accommodation Structures," Tourism Economics, , vol. 19(4), pages 779-799, August.
    • Handle: RePEc:sae:toueco:v:19:y:2013:i:4:p:779-799
    DOI: 10.5367/te.2013.0319
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    References listed on IDEAS

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    1. Jean Tirole, 1988. "The Theory of Industrial Organization," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262200716, April.
    2. Hjalager, Anne-Mette, 2010. "A review of innovation research in tourism," Tourism Management, Elsevier, vol. 31(1), pages 1-12.
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