Understanding tourists' economizing strategies during the global economic crisis

Abstract

This paper explores how tourists from 165 regions of EU-27 countries cut back their tourism expenditure during the global economic crisis in 2009. Cutbacks in tourism expenditure are divided into two mutually related decisions: Firstly, whether or not the tourists decided to cut back on tourism expenditure because of the crisis; and second, which of six options they employed as their cut-back strategy: "fewer holidays", "reduced length of stay", "cheaper means of transport", "cheaper accommodation", "travel closer to home" or "change the period of travel". The econometric model used to address these kinds of simultaneous decisions is an adaptation of the Heckman model within a generalized structural equations modelling approach. This methodology controls for sample selection bias and correlations between equations. This paper highlights patterns in cutback decisions that are associated with the socioeconomic characteristics of the household and the climate in the country of origin.