Journal of Tourism and Recreation

Journal of Tourism and Recreation

ISSN: 2368-2655 (Print)    ISSN: 2368-2663 (Online)

Volume 1 (2014), No. 1, Pages 21-36

DOI: 10.12735/jotr.v1i1p21

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French and German Tourism in the Mediterranean - A Market Share Analysis

William Gatt1  Joseph Falzon2 

1Modelling & Research Department, Central Bank of Malta, Malta
2Department of Banking & Finance, University of Malta, Malta

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To Cite this Article     Article Views: 1396     Downloads: 789  Since January, 2015


Tourism is an important economic sector for Mediterranean countries, and these compete for market share. In our study we look at the evaluation of market shares amongst a group of seven Mediterranean countries for both German and French tourists. Our data shows that these shares have changed significantly over the period 1963-2009. We utilise the Almost Ideal Demand System, a model grounded in economic theory, to understand what has driven these changes. The estimated own-price elasticities indicate the sensitivity of demand to price increases in each country, while cross-price elasticities shed light on the relative complementarity and substitutability of the holiday destinations. We find that while Spain was relatively unaffected by the development of the tourism market in countries such as Cyprus, Malta and Turkey, Italy lost significant market share, in part due to a relative loss of competitiveness. An innovation of this study is an assessment of the stability of the elasticity estimates over the sample. In line with other studies in this area, we highlight that the results of this study can serve as useful information for policymakers in the formulation of policies on tourism market development.

Keywords: tourism demand, almost ideal demand system, demand elasticities, Mediterranean countries

To Cite this Article: Gatt, W., & Falzon, J. (2014). French and German tourism in the Mediterranean - A market share analysis. Journal of Tourism and Recreation, 1(1), 21-36.

Copyright © William Gatt & Joseph Falzon

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This article is published under license to Science and Education Centre of North America. This is an Open Access article distributed under the terms of the Creative Commons Attribution 4.0 International License.

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French and German Tourism in the Mediterranean - A Market Share Analysis