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Impact of location on the probability of default in the Spanish lodging industry

Author

Listed:
  • Milagros Vivel-Búa

    (University of Santiago de Compostela, Spain)

  • Rubén Lado-Sestayo

    (University of A Coruña, Spain)

  • Luis Otero-González

    (University of Santiago de Compostela, Spain)

Abstract

The authors analyse the determinants of business failure in micro-, small- and medium-sized Spanish hotel companies during 2008–2011. They consider accounting variables representative of the economic and financial situation and other variables of lodging activity. This approach is important because several previous studies have highlighted the need to develop empirical models tailored to an industry, especially when it is as significant in the national economy as the hotel industry is in Spain. The article also examines whether the models developed to date remain valid in the new economic environment characterized by the economic crisis. The results obtained confirm the influence on the probability of business failure of profitability, debt, economic structure, economic and financial stability and liquidity. Moreover, significant influence is identified with regard to the number of delegations, the level of employment, seasonality and competitive concentration in the tourist destination where the business is located.

Suggested Citation

  • Milagros Vivel-Búa & Rubén Lado-Sestayo & Luis Otero-González, 2016. "Impact of location on the probability of default in the Spanish lodging industry," Tourism Economics, , vol. 22(3), pages 593-607, June.
    • Handle: RePEc:sae:toueco:v:22:y:2016:i:3:p:593-607
    DOI: 10.5367/te.2015.0461
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    References listed on IDEAS

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    Cited by:

    1. Theodore Metaxas & Athanasios Romanopoulos, 2023. "A Literature Review on the Financial Determinants of Hotel Default," JRFM, MDPI, vol. 16(7), pages 1-19, July.

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    Keywords

    determinants; failure; hotel; MSMEs;
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