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Market Potential, Industrial Density and Revenue of Tourism Firms in China

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  • Yong Yang

    (Department of Tourism, Business School, East China Normal University, No 500 Dongchuan Road, 200241 Shanghai, China)

Abstract

China is a major source of empirical observations with which to test different hypotheses relative to tourism research. In this paper, the author constructs a spatial model of tourism industry development and, considering spatial distance, uses Chinese tourism panel data to analyse the relationship between market potential, industrial density and the revenue of tourism firms. The study provides evidence that tourism market potential and agglomeration density are statistically significant and quantitatively important in explaining the revenue of tourism firms. This finding is robust, controlling for input factor density and endogeneity using instrument variables. Tourism market potential is found to matter through the mechanisms promoted by new economic geography theory. The estimated coefficients are consistent with plausible values for the predication of the model.

Suggested Citation

  • Yong Yang, 2014. "Market Potential, Industrial Density and Revenue of Tourism Firms in China," Tourism Economics, , vol. 20(6), pages 1253-1275, December.
    • Handle: RePEc:sae:toueco:v:20:y:2014:i:6:p:1253-1275
    DOI: 10.5367/te.2013.0346
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    References listed on IDEAS

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    Cited by:

    1. Isabel P. Albaladejo & Fuensanta Arnaldos & María Pilar Martínez-García, 2024. "Tourism distribution at competing destinations: Mobility changes and relocation," Tourism Economics, , vol. 30(2), pages 301-323, March.
    2. Claudio Calero & Lindsay W Turner, 2020. "Regional economic development and tourism: A literature review to highlight future directions for regional tourism research," Tourism Economics, , vol. 26(1), pages 3-26, February.

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