Asymmetric elasticities in inbound international tourism demand?

ABSTRACT

This study examines whether price and income elasticities in international tourism demand can be asymmetric depending on the direction of change. We consider Fiji as a reference destination with the following source markets: Australia, Canada, Japan, New Zealand, United Kingdom, and the USA. A sample from 1978 to 2018 is considered. Symmetric price and income elasticities are found for Australia and New Zealand. Asymmetric price and symmetric income elasticities are found for Canada and Japan. Price and income asymmetries are found for the UK and USA. The implication for research on tourism demand is that linear models may be miss-specified and that better predictions of tourism demand may result from the nonlinear models.

KEYWORDS:

• Tourism demand
• asymmetric price elasticity
• asymmetric income elasticity
• nonlinear tourism demand model

Disclosure statement

No potential conflict of interest was reported by the authors.