Academic journal article European Research Studies

Investigation of Convergence in the Tourist Markets of Greece

Academic journal article European Research Studies

Investigation of Convergence in the Tourist Markets of Greece

Article excerpt

1. Introduction

Tourism is considered an international industry and the largest provider of jobs that not only constitutes a modern driving force for the development process but also helps accelerate the recovery of the global economy. International tourism revenue is an important source of foreign exchange. In many cases, it helps to eliminate current account deficits and the negative balance of payments. In addition, the increase in foreign exchange income through other activities related to tourism provides the security for a further increase in foreign exchange reserves and further contributes to improving the balance of payments of each economy. Moreover, increased tourist activity enhances the chances of importing capital goods used to produce goods and services and increasing tax revenues in the country receiving each time the tourist influx. The positive effects of tourism in an economy are commonly accepted for all economies, regardless of the level of growth or size of each economy. Therefore, based on the above, the tourism industry has a positive contribution to economic growth (McKinnon, 1964; Oh, 2005; Kim & Chen, 2006; Katircioglu, 2009).

The growing global role of tourism has mobilized researchers who have attempted to study its various aspects, with an emphasis on the causal relation between tourism (arrivals or revenue) and economic development (Katircioglu, 2010; Lee, 2012; Savas, et al., 2012). Despite the importance of the tourism industry, most empirical studies on tourism were based on the functions of tourism demand (Luzzi & Fluckiger, 2003).

According to Shan and Wilson (2001), several fields remain incomplete in this type of study and therefore require further investigation. A relatively new and still under investigation issue concerning tourism is also the case of the convergence of tourist markets. The importance of studying the case of convergence in the tourism sector is a way of measuring and evaluating the successful implementation of the strategies that contribute to the promotion of the tourism product as well as the basis for planning the strategies to be implemented in the future for attracting tourists from different destinations to a specific country.

According to Narayan (2006), who first raised this issue to be investigated, the convergence case refers to the effectiveness of the marketing policies for the tourist product targeted at a specific country of origin, which is ascertained if the arrivals of visitors from the country of origin converge with the total of the international arrivals of visitors in the destination country. Therefore, if the increase in arrivals from these markets of origin positively affects the total international arrivals of visitors in the host country, then the increase in total international arrivals is based on the specific country of origin, which converges. Consequently, strategies focusing on boosting the arrivals of visitors from a converging country improve the overall volume of international arrivals of visitors. The convergence case, therefore, provides a way of measuring the success of the marketing strategies and can help in the design of future strategies. More specifically, if a marketing campaign on a certain market--source of tourism is effective, then the rate of arrivals from this market in the total arrivals will increase. In this way, it is found out that a policy is effective. If this is not the case, the strategy should either be withdrawn or re-adjusted.

Based on all the above mentioned, there is a keen interest in exploring the case of convergence in the tourism industry. Particularly, if the markets of origin converge with the host country, this shows to the policymakers that the tourist industry in the host country is heading towards the right direction and the potential of the industry can be exploited through the appropriate tourism policies. If the arrivals of visitors from a specific country of origin converge with the total arrivals of the host country, this indicates that this market contributes significantly to the increase in the total arrivals of the host country. …

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