Factors influencing tourism development between 1950 and 2010
| Factors | Comments |
|---|---|
| Demand-related factors | |
| Population | The number of departures generated by a market, or a region, is positively related to the size of its resident population. Population characteristics, such as age structure and geographical distribution, also influence travel propensity. The increasing popularity of tourism in densely populated markets opened up to unprecedented opportunities for the global sector development |
| Affluence | Households’ economic prosperity have been positively relating to tourism demand development over the past decades. People start allocating disposable income in leisure travel only once its level exceeds the threshold marked by the cost of goods and services fulfilling basic needs. Rising affluence in developing economies has been a boost of tourism development since the beginning of the twenty-first century |
| Distance travelled | The income threshold for people to travel tends to increase with the distance travelled, as the monetary cost of travel also increases. This partially explains the pattern, which sees domestic and short-haul travel expanding more rapidly than long-haul trips in emerging markets. Competition on well-travelled routes can dwindle transportation prices and reverse the direct relationship. The low-cost models on short-haul trips has been one of the key factors underlying tourism growth at the end of the twentieth century |
| Relative cost of travel | The cost of tourism-related goods and services in a country determines the distribution of price-elastic tourism demand across destinations. Inflation and exchange rates, at the origin and at the destination, impact on the relative cost of a trip, hence on demand. Enabled by improved air connectivity and visibility offered by online platforms, the relative cost of travel at the destination has become a major component of destination competitiveness. Yield management techniques offered companies the possibility to exploit location and seasonality factors to improve their price competitiveness |
| Time | Travel is a time-consuming activity. The amount of days of paid leave and the calendar of public holidays influenced leisure tourism propensity and patterns since its early days. Speedier transportation and flexible time management (e.g. working hours) contribute to reduce the impact discretionary time has on international tourism, as seen with technological improvements in airlines or train connections and the rise of short-breaks since the early 2000s. The tendency to take more frequent breaks resulted in a decrease in the average duration and expenditure per trip |
| Social attitudes | Over the past decades, tourism has turned from an élite to a mass activity and a mirror of individuals’ social-status, which was reflected into the diversification of tourism products. More recently, tourism for personal purposes has turned into an engaging, if not life-changing, activity undertaken to acquire new skills (e.g. enhancing sport, language, handcraft skills), enhance knowledge (e.g. deep dive into a specific topics) or a spiritual experience. Societal changes such as an ageing population and changes in family structures also contributed to the rise of new products, e.g. targeting multi-generation families or solo travellers |
| Supply (destination)-related factors | |
| Connectivity | Transport infrastructure is the factor enabling visitors to reach a place, hence a key driver in tourism development. Investments to expand air, rail and road infrastructure contributed to increase the number of destinations on the global tourism map |
| Marketing | Marketing made a major contribution to tourism development since the 1950s. Advances made by academics and practitioners, coupled with internet-based and mobile technology development, were key components of the professionalisation and sophistication of destination marketing approaches. Improved visibility, effective targeting and engaging marketing tactics significantly contributed to stimulate demand flows and repeat visits. Increased availability of information improved transparency and supported travellers’ decision-making process. Recently, tracking services and mobile technology enabled service providers to establish a close, real-time relationship with customers |
| Attractions | Being them leisure or business attractions, natural or cultural, attractions are the trigger for people to visit a place abroad |
| Local regulatory framework | Given the public nature of key infrastructure and many attractions, the regulatory framework most strongly affects tourism development, the range and quality of tourism products, and the sector competitiveness in the global market |
| Infrastructure | This entails both elements related to mobility at the destination and accommodation and is necessary for the visitor to reach and consume the tourism product. Capacity, quality and innovation are characteristics, which increase the attractive power of a destination |
| Safety | It is a critical factor for tourists visiting a destination, as violence, upheavals or poor health conditions can deter visitors from travelling |
| Investments | Government direct expenditure in tourism is a factor that influences sector’s development both directly and indirectly, as a positive sign to private potential investors about the country potential. Industrial policies facilitating foreign investment and business start-up also influence tourism development |
| Property rights | Property protection is a major issue, especially in developing countries, the lack of which discourages foreign investors in directed much needed capital into developing destinations, despite incentives such as lower cost of land and labour |
| External environment | |
| Migration | Migration policies influence visitors’ ability to visit a foreign country, through visa requirements. Whenever required, the time and monetary cost of obtaining a visa adds up to the total cost of the trip, which negatively impacts on tourism demand. Visa requirements vary across countries, as a reflection of a country’s international relations. In general, citizens of advanced, trade-based economies have apparently the fewest visa restrictions, which influences the flows of departures and limits the growth potential of emerging economies as generating markets |
| Environmental regulation | Climate change and tourism are closely related one another. Climate change can impact on tourism destinations’ attractiveness, but it is also fuelled by tourism growth, as it contributes to GHG emissions. Policy and management responses have been adopted by international organisations, public administrations, and the tourism sector at large in the attempt of adapting to as well as mitigating of climate change |
| Natural and man-made hazards | Since tourism turned into a global phenomenon, global demand has become more vulnerable to hazards. Political uncertainties or threats that reduced safety proved to be a significant deterrent especially for long-haul travel demand. Extreme natural events also negatively impact on a tourism destination image and demand. The intensification of events related to Climate Change started influencing tourists’ preferences for the destinations most affected by these changes |
| Factors | Comments |
|---|---|
| Population | The number of departures generated by a market, or a region, is positively related to the size of its resident population. Population characteristics, such as age structure and geographical distribution, also influence travel propensity. The increasing popularity of tourism in densely populated markets opened up to unprecedented opportunities for the global sector development |
| Affluence | Households’ economic prosperity have been positively relating to tourism demand development over the past decades. People start allocating disposable income in leisure travel only once its level exceeds the threshold marked by the cost of goods and services fulfilling basic needs. Rising affluence in developing economies has been a boost of tourism development since the beginning of the twenty-first century |
| Distance travelled | The income threshold for people to travel tends to increase with the distance travelled, as the monetary cost of travel also increases. This partially explains the pattern, which sees domestic and short-haul travel expanding more rapidly than long-haul trips in emerging markets. Competition on well-travelled routes can dwindle transportation prices and reverse the direct relationship. The low-cost models on short-haul trips has been one of the key factors underlying tourism growth at the end of the twentieth century |
| Relative cost of travel | The cost of tourism-related goods and services in a country determines the distribution of price-elastic tourism demand across destinations. Inflation and exchange rates, at the origin and at the destination, impact on the relative cost of a trip, hence on demand. Enabled by improved air connectivity and visibility offered by online platforms, the relative cost of travel at the destination has become a major component of destination competitiveness. Yield management techniques offered companies the possibility to exploit location and seasonality factors to improve their price competitiveness |
| Time | Travel is a time-consuming activity. The amount of days of paid leave and the calendar of public holidays influenced leisure tourism propensity and patterns since its early days. Speedier transportation and flexible time management (e.g. working hours) contribute to reduce the impact discretionary time has on international tourism, as seen with technological improvements in airlines or train connections and the rise of short-breaks since the early 2000s. The tendency to take more frequent breaks resulted in a decrease in the average duration and expenditure per trip |
| Social attitudes | Over the past decades, tourism has turned from an élite to a mass activity and a mirror of individuals’ social-status, which was reflected into the diversification of tourism products. More recently, tourism for personal purposes has turned into an engaging, if not life-changing, activity undertaken to acquire new skills (e.g. enhancing sport, language, handcraft skills), enhance knowledge (e.g. deep dive into a specific topics) or a spiritual experience. Societal changes such as an ageing population and changes in family structures also contributed to the rise of new products, e.g. targeting multi-generation families or solo travellers |
| Connectivity | Transport infrastructure is the factor enabling visitors to reach a place, hence a key driver in tourism development. Investments to expand air, rail and road infrastructure contributed to increase the number of destinations on the global tourism map |
| Marketing | Marketing made a major contribution to tourism development since the 1950s. Advances made by academics and practitioners, coupled with internet-based and mobile technology development, were key components of the professionalisation and sophistication of destination marketing approaches. Improved visibility, effective targeting and engaging marketing tactics significantly contributed to stimulate demand flows and repeat visits. Increased availability of information improved transparency and supported travellers’ decision-making process. Recently, tracking services and mobile technology enabled service providers to establish a close, real-time relationship with customers |
| Attractions | Being them leisure or business attractions, natural or cultural, attractions are the trigger for people to visit a place abroad |
| Local regulatory framework | Given the public nature of key infrastructure and many attractions, the regulatory framework most strongly affects tourism development, the range and quality of tourism products, and the sector competitiveness in the global market |
| Infrastructure | This entails both elements related to mobility at the destination and accommodation and is necessary for the visitor to reach and consume the tourism product. Capacity, quality and innovation are characteristics, which increase the attractive power of a destination |
| Safety | It is a critical factor for tourists visiting a destination, as violence, upheavals or poor health conditions can deter visitors from travelling |
| Investments | Government direct expenditure in tourism is a factor that influences sector’s development both directly and indirectly, as a positive sign to private potential investors about the country potential. Industrial policies facilitating foreign investment and business start-up also influence tourism development |
| Property rights | Property protection is a major issue, especially in developing countries, the lack of which discourages foreign investors in directed much needed capital into developing destinations, despite incentives such as lower cost of land and labour |
| Migration | Migration policies influence visitors’ ability to visit a foreign country, through visa requirements. Whenever required, the time and monetary cost of obtaining a visa adds up to the total cost of the trip, which negatively impacts on tourism demand. Visa requirements vary across countries, as a reflection of a country’s international relations. In general, citizens of advanced, trade-based economies have apparently the fewest visa restrictions, which influences the flows of departures and limits the growth potential of emerging economies as generating markets |
| Environmental regulation | Climate change and tourism are closely related one another. Climate change can impact on tourism destinations’ attractiveness, but it is also fuelled by tourism growth, as it contributes to GHG emissions. Policy and management responses have been adopted by international organisations, public administrations, and the tourism sector at large in the attempt of adapting to as well as mitigating of climate change |
| Natural and man-made hazards | Since tourism turned into a global phenomenon, global demand has become more vulnerable to hazards. Political uncertainties or threats that reduced safety proved to be a significant deterrent especially for long-haul travel demand. Extreme natural events also negatively impact on a tourism destination image and demand. The intensification of events related to Climate Change started influencing tourists’ preferences for the destinations most affected by these changes |