Shock Effects on Tourism Demand Cycles to Bali
DOI:
https://doi.org/10.5614/ajht.2022.20.2.03Keywords:
Shocks, Tourism, Demand, Cycles, BaliAbstract
Various kinds of shocks can influence tourism demand cycles. However, previous studies have typically concentrated within economic frameworks in explaining variations of tourism demand cycles, ignoring the possibility of different shocks influencing tourism demand cycles. This paper analyses various shocks in explaining the variation of tourism demand cycles to Bali on different source market countries. Monthly tourist arrivals data from January 2002 to January 2020 are decomposed into cyclical and irregular components. The cyclical patterns represent tourism demand cycles, and shock events are represented by irregular component patterns of international tourist arrivals data series. This study employs an unobserved component model (UCM) procedure to decompose the data, unit root tests to examine data stationarity, and logistic regression to analyse the relationship between shock effects on tourism demand cycles. The unit root test result indicates that shock effects on tourism demand cycles are not permanent. However, the persistence and magnitude of shock effects vary between source market countries. Shock effects could be persistent and influence the negative phase of the cycles for several countries. The persistence and magnitude of shock effects are the highest for tourist arrivals from the United States, India, and Germany. The results provide theoretical and managerial implications.
References
Agung, I. G. N. (2011). Time series data analysis using EViews: John Wiley & Sons.
Ara, J. E., & Le, C. J. (2008). The impact of terrorism on tourism demand. Annals of Tourism Research, 35(2), 299-315. DOI: 10.1016/j.annals.2007.08.003
Baig, S., & Hussain, H. (2020). Do shocks have permanent or transitory effects on tourist inflow? An application of stationarity test with structural breaks: Evidence reexamined for Gilgit-Baltistan, Pakistan. Asia Pacific Journal of Tourism Research, 25(2), 120-130. DOI: :10.1080/10941665.2019.1684961
Bails, D., & Peppers, L. C. (1993). Business fluctuations: forecasting techniques and applications: Prentice Hall.
Balli, F., Curry, J., & Balli, H. O. (2015). Inter-regional spillover effects in New Zealand international tourism demand. Tourism Geographies, 17(2), 262-278.
BPS. (2020). Statistik Pariwisata Bali [Bali Tourism Statistics]. Retrieved on March 8, 2021 from https://bali.bps.go.id/statictable/2018/02/09/21/jumlah-wisatawan-asing-ke-bali-menurut-bulan-1982-2020.html.
BPS. (2021). Kunjungan Wisatawan Mancanegara ke Bali dan Indonesia [International Visitors to Bali and Indonesia]. Retrieved on March 8, 2021 from https://bali.bps.go.id/statictable/2018/02/09/28/banyaknya-wisatawan-mancanegara-ke-bali-dan-indonesia-1969-2020.html.
Bronner, F., & de Hoog, R. (2017). Tourist demand reactions: Symmetric or asymmetric across the business cycle? Journal of Travel Research, 56(7), 839-853.
Burnham, K. P., & Anderson, D. R. (2004). Multimodel inference: understanding AIC and BIC in model selection. Sociological methods & research, 33(2), 261-304.
Carlsen, J. C., & Hughes, M. (2008). Tourism market recovery in the Maldives after the 2004 Indian Ocean tsunami. Journal of Travel & Tourism Marketing, 23(2-4), 139-149.
Chang, C.-L., Khamkaew, T., Tansuchat, R., & McAleer, M. (2011). Interdependence of international tourism demand and volatility in leading ASEAN destinations. Tourism Economics, 17(3), 481-507.
Coshall, J. T., & Charlesworth, R. (2011). A management orientated approach to combination forecasting of tourism demand. Tourism Management, 32(4), 759-769.
Cr S., & Martins, A. M. (2017). Structural breaks in international tourism demand: Are they caused by crises or disasters? Tourism Management, 63, 3-9.
Croes, R., & Ridderstaat, J. (2017). The effects of business cycles on tourism demand flows in small island destinations. Tourism Economics, 23(7), 1451-1475.
Croes, R., Ridderstaat, J., & Rivera, M. (2018). Asymmetric business cycle effects and tourism demand cycles. Journal of Travel Research, 57(4), 419-436.
de Larrea, G. L., Ridderstaat, J., Kizildag, M., & Weinland, J. (2019). Does the Fear Index Incessantly Affect Stock Performance in the Lodging Industry? The Journal of Hospitality Financial Management, 27(1), 4-15.
Ertuna, C., & Ilhan Ertuna, Z. (2009). The sensitivity of German and British tourists to news shocks. Tourism Review, 64(3), 19-27.
Guizzardi, A., & Mazzocchi, M. (2010). Tourism demand for Italy and the business cycle. Tourism Management, 31(3), 367-377.
Gurtner, Y. (2016). Returning to paradise: Investigating issues of tourism crisis and disaster recovery on the island of Bali. Journal of Hospitality and Tourism Management, 28, 11-19. doi:10.1016/j.jhtm.2016.04.007
Hall, S., Emmett, C., Cope, A., Harris, R., Setiadi, G. D., Meservy, W., & Berrett, B. (2019). Tsunami knowledge, information sources, and evacuation intentions among tourists in Bali, Indonesia. Journal of Coastal Conservation, 23(3), 505-519. DOI: 10.1007/s11852-019-00679-x
Kim, H., & Gu, Z. (2010). A logistic regression analysis for predicting bankruptcy in the hospitality industry. Journal of Hospitality Financial Management, 14(1), 24.
Kim, S. S., & Wong, K. K. (2006). Effects of news shock on inbound tourist demand volatility in Korea. Journal of Travel Research, 44(4), 457-466.
Kompas. (2020). Majority of Hotels in Bali Close Operations, The Rest Try to Survive. Retrieved on June 8, 2021 from https://travel.kompas./read.
Kubickova, M., Kirimhan, D., & Li, H. (2019). The impact of crises on hotel rooms' demand in developing economies: The case of terrorist attacks of 9/11 and the global financial crisis of 2008. Journal of Hospitality and Tourism Management, 38, 27-38.
Kulendran, N., & Wong, K. K. (2011). Determinants versus composite leading indicators in predicting turning points in growth cycle. Journal of Travel Research, 50(4), 417-430.
Lean, H. H., & Smyth, R. (2009). Asian financial crisis, avian flu and terrorist threats: are shocks to Malaysian tourist arrivals permanent or transitory? Asia Pacific Journal of Tourism Research, 14(3), 301-321.
Liu, A., & Pratt, S. (2017). Tourism's vulnerability and resilience to terrorism. Tourism Management, 60, 404-417.
Narayan, P. K. (2005). The structure of tourist expenditure in Fiji: Evidence from unit root structural break tests. Applied Economics, 37(10), 1157-1161.
Narayan, P. K. (2011). Are shocks to tourism transitory at business cycle horizons? Applied Economics, 43(16), 2071-2077.
Peng, G. B., Song, H., & Witt, S. F. (2012). Demand modeling and forecasting. In Handbook of Research Methods in Tourism: Edward Elgar Publishing.
Perles-Ribes, J. F., Ram-Rodruez, A. B., Rubia-Serrano, A., & Moreno-Izquierdo, L. (2016). Economic crisis and tourism competitiveness in Spain: permanent effects or transitory shocks? Current Issues in Tourism, 19(12), 1210-1234.
Picard, M. (1995). Cultural heritage and tourist capital: cultural tourism in Bali. International tourism: Identity and change, 48, 44-66.
Rahmawati, P. I., Trianasari, N., & Martin, A. N. Y. (2019, January). The economic impact of mount agung eruption on Bali tourism. In International Conference on Tourism, Economics, Accounting, Management, and Social Science (TEAMS 2018) (pp. 98-107). Atlantis Press.
Reisinger, Y., & Mavondo, F. (2005). Travel Anxiety and Intentions to Travel Internationally: Implications of Travel Risk Perception. Journal of Travel Research, 43(3), 212-225. DOI: 10.1177/0047287504272017
Reisinger, Y., & Mavondo, F. (2006). Cultural Differences in Travel Risk Perception. Journal of Travel & Tourism Marketing, 20(1), 13-31. DOI: 10.1300/J073v20n01_02
Ridderstaat, J. (2021). Households? Net financial wealth as a determinant of tourism demand cycles: Evidence from US travel to selected Caribbean destinations. Journal of Travel Research, 60(3), 564-582.
Ridderstaat, J., & Croes, R. (2017). The link between money supply and tourism demand cycles: A case study of two Caribbean destinations. Journal of Travel Research, 56(2), 187-205.
Ridderstaat, J., Croes, R., & Nijkamp, P. (2013). Tourism development, quality of life and exogenous shocks: A systemic framework. International Journal of Society Systems Science, 5(4), 321-336.
Ridderstaat, J. R., & Nijkamp, P. (2016). Small Island Destinations and International Tourism: Market Concentration and Distance Vulnerabilities. In Self-determinable Development of Small Islands (pp. 159-178). Springer, Singapore.
Saglam, Y., & Ampountolas, A. (2020). The effects of shocks on Turkish tourism demand: Evidence using panel unit root test. Tourism Economics, 1354816619899831.
Schwert, G. (1989). Tests for unit roots: a Monte Carlo investigation. Journal of Business & Economic Statistics, 7, 147-159. DOI: 10.1080/07350015.1989.10509723
Seabra, C., Dolnicar, S., Abrantes, J. L., & Kastenholz, E. (2013). Heterogeneity in risk and safety perceptions of international tourists. Tourism Management, 36, 502-510. DOI: 10.1016/j.tourman.2012.09.008
Smeral, E. (2012). International tourism demand and the business cycle. Annals of Tourism Research, 39(1), 379-400. DOI: 10.1016/j.annals.2011.07.015
Smyth, R., Nielsen, I., & Mishra, V. (2009). ?I?ve been to Bali too?(and I will be going back): Are terrorist shocks to Bali's tourist arrivals permanent or transitory? Journal of Applied Economics, 41(11), 1367-1378.
Sonmez, S., & Graefe, A. R. (1998). Determining future travel behavior from past travel experience and perceptions of risk and safety. Journal of Travel Research, 37, 171-177.
Subadra, I. N., & Hughes, H. (2021). Pandemic in paradise: Tourism pauses in Bali. Tourism and Hospitality Research, 14673584211018493.
Tan, S.-H., & Tan, S.-K. (2014). Are shocks to Singapore's tourist arrivals permanent or transitory? An application of stationarity test with structural breaks. Current Issues in Tourism, 17(6), 480-486.
Tversky, A., & Kahneman, D. (1979). Prospect theory: an analysis of decision under risk. Econometrica, 47(2), 263-292.
UNWTO. (2021). World Tourism Barometer: International Travel Largely on Hold Despite Uptick in May 2021. Retrieved on June 8, 2021 from https://webunwto.s3.eu-west-1.amazonaws.com/s3fs-public/2021-07/UNWTO_Barom21_04_July_excerpt.pdf?VBGz_hsTz2fvBSOn3i1w7kv0qhI2rTgY=.
WTTC. (2020). Economic Impact Reports. Retrieved from https://wttc.org/Research/Economic-Impact.
Yucel, A. G. (2021). Are shocks to tourist arrivals permanent or transitory? A comprehensive analysis on the top 20 most-visited countries. Current Issues in Tourism, 24(16), 2294-2311.
Zhang, H., Song, H., Wen, L., & Liu, C. (2021). Forecasting tourism recovery amid COVID-19. Annals of Tourism Research, 87, 103149.
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2022 Rina Kurniawati
This work is licensed under a Creative Commons Attribution-NoDerivatives 4.0 International License.
Manuscript submitted to ASEAN Journal on Hospitality and Tourism has to be an original work of the author(s), contains no element of plagiarism, and has never been published or is not being considered for publication in other journals. The author(s) retain the copyright of the content published in ASEAN Journal on Hospitality and Tourism. There is no need for request or consultation for future re-use and re-publication of the content as long as the author and the source are cited properly.
