Factors influencing the contribution of each individual input to productivity growth in the Spanish hotel industry

Abstract

This paper investigates the contribution of each individual input to total factor productivity change, distinguishing between technical and efficiency change, for a sample of Spanish hotels for the period 1997-2019. To do so, we apply the non-radial and non-parametric weighted Russell directional distance model (WRDDM) considering an input orientation and the Luenberger productivity indicator. In a second stage, drivers of productivity, technical and efficiency changes are analysed for each input considering a linear dynamic panel data model. Results indicate that productivity rose during the period, with capital and labour productivity changes behind this increase. Factors such as being affiliated to an international hotel chain or the market share of hotels have a significant effect on total factor productivity change, technical change and efficiency change.