Half a century of mass tourism: evolution and expectations

This paper presents a retrospective analysis of the service sector focusing on the hotel industry with reference to how internationalisation and globalisation are having a major effect on demand, and as a result how changes must be made to what is offered. The so-called mass tourism must evolve; we are about to enter the second decade of the twenty-first century and mass tourism needs to be transformed. A large number of issues need to be borne in mind, such as the influence technological progress is having on the ways of travelling and booking and on sustainable, environmental tourism. Also to be taken into account is the competitiveness of the so-called emerging nations, for which a mature country like ours can provide new tourist packages.     

Diversification entry: Internal development versus acquisition

The economic theory of barriers to entry is integrated with the corporate strategy concept of relatedness, to develop a model of the choice between internal development and acquisition in diversification entry into new markets. The model is tested on original data collected for this study from PIMS Program participants. These original data cover the parent company characteristics, entry strategy and entry outcome for 59 entrants into 31 markets. These entry-related data are merged with existing PIMS data on the structure of the entered markets and their incumbents. Results of binary regression analysis show that the choice between the two entry modes is well explained by measures of barriers and relatedness. Higher barriers are more likely to be associated with acquisition entry. Greater relatedness is more likely to be associated with direct entry.     

Layout problem for an aircraft maintenance company tool room

A tool room of an aircraft maintainance company with 10000 tools is considered. These tools are borrowed by the mechanics when needed and must be returned before the end of shift. About 400 in-out transactions are handled by the storekeepers of the room. However, since the room is usually crowded with mechanics at their shift start/end times, the storekeepers are overloaded and significant productive manpower is held up in waiting for the tools. Therefore, the racks and tools in the tool room are required to be rearranged so that the handling time of the in/out transactions can be reduced.The racks are rearranged by heuristics and then tools are allocated to the racks according to request probabilities, which are estimated by the proportion of each tool's on-loan frequency to the total on-load frequency during December 1992. Effectiveness is measured by comparing the total rectilinear distance travelled to fetch the tools requested during 11–15 January 1993 based on the proposed changes, to that based on existing rack and tool arrangement. It was found that improvement by tool allocation according to the request probabilities could reach up to 39% with the existing rack arrangement. Furthermore, minor rearrangement on the racks could also reduce the distance travelled by 12%.     

The relative importance of time and dollar values in new product introduction decisions

This study investigates managerial sensitivity to timing differences in new product introduction decisions. Using a case scenario as the research setting, the study finds that in managerial decisions involving a choice between two-attribute alternatives (dollar value and time), respondents shifted their emphasis between attributes when they were personally affected by the decision outcome. Specifically, it was found that an additive constant manipulation (adding a constant to the dollar amount of each alternative) caused respondents to place more emphasis on the time attribute, and a multiplicative constant manipulation (multiplying the dollar amount of each alternative by a constant) caused them to place more emphasis on the dollar-value attribute.The study asks 108 subjects to assume the role of product manager in a case scenario and choose from among three two-attribute alternatives proposed by the case. The personal relevance of the decision was manipulated by telling respondents that the CEO in the decision scenario had stated publicly that the career of the decision maker would be (would not be) affected. The results show that the additive constant and multiplicative constant effects were only found when the decision outcomes would affect the respondents' career.     

Population growth and economic growth: a reconsideration

The relationship between population growth and development has long been a controversial topic in the economic development literature. Early work by Hoover and Coale and more recent work by Blanchet suggest that high fertility suppresses per capita income growth. However, recent work by Kelley and Srinivasan are ambivalent about such a neo-Malthusian relationship between population growth and economic growth. The authors examine these conflicting positions. They emphasize that the rates of both population growth and income growth are endogenous variables within a general equilibrium framework. An endogenous growth model with endogenous fertility is then developed. It is found that when all exogenous variables are controlled for, there exists an inverse relation between population growth and economic growth. However, when some exogenous factors change, such as an improvement in technological progress, the relation becomes ambiguous. This suggests that the conflicting findings in the literature may be because of the presence of substantial heterogeneity in unobserved variables across countries and over time in cross-country panel data sets.     

Optimal population size and endogenous growth

"Many applications in economics require the selection of an objective function which enables the comparison of allocations involving different population sizes. The two most commonly used criteria are the Benthamite and the Millian welfare functions, also known as classical and average utilitarianism, respectively. The former maximizes total utility of the society and thus represents individuals, while the latter maximizes average utility and so represents generations. Edgeworth (1925) was the first to conjecture, that the Benthamite principle leads to a larger population size and a lower standard of living.... The purpose of this paper is to examine Edgeworth's conjecture in an endogenous growth framework in which there are interactions between output and population growth rates. It is shown that, under conditions that ensure an optimum, the Benthamite criterion leads to smaller population and higher output growth rates than the Millian."     

Identification of consumers’ preferences when their choices are unobservable

Summary. We provide conditions under which the heterogenous, deterministic preferences of consumers in a pure exchange economy can be identified from the equilibrium manifold of the economy. We extend those conditions to consider exchange economies, with two commodities, where consumers preferences are random. For the latter, we provide conditions under which consumers heterogenous random preferences can be identified from the joint distribution of equilibrium prices and endowments. The results can be applied to infer consumers preferences when their demands are unobservable.Received: 8 May 2003, Revised: 14 September 2004, JEL Classification Numbers: D12, D51.I am very grateful to an anonymous referee, Donald Brown, and Daniel McFadden for their detailed comments and insightful suggestions. Section 2 of this paper is joint work with Donald J. Brown; it is included here for publication with his permission. Those results were presented at the 1990 Workshop on Mathematical Economics at the University of Bonn, the 1992 SITE Workshop on Empirical Implications of General Equilibrium Models at Stanford University, and, more recently, at the June 2000 Conference in Honor of Rolf Mantel, in Buenos Aires, Argentina. The comments of the participants at those conferences and workshops are much appreciated. The research presented in this paper was supported by NSF Grants SES-8900291, SBR-9410182, and SES-0241858. This paper is dedicated to Marcel K. Richter, who has inspired much of my research.     

A Signalling Model of Firms' Foreign Direct Investment Relocation Decision

We analyse whether the foreign government can influence the multinational firm's relocation decision, through signalling the amount of subsidy it can grant. The foreign country is one of two possible types which differ on their investment conditions. Comparing the results obtained with an adverse selection model (the government knows the country type but the firm does not) with the results of a signalling model, we conclude that relocation is more likely, and the necessary subsidy is smaller, in the signalling model than with adverse selection. This can explain the proliferation of Investment Support Agencies worldwide.     

Effects of Adverse Selection on a Multinational Firm’s Decision on where to Subcontract

This paper analyses the effects of adverse selection on a multinational firm’s decision on where to subcontract. Adverse selection arises since subcontractor firms have more information than the multinational concerning their production costs. The results obtained show that adverse selection confers to subcontractor firms an advantage in their relationship with the multinational, inducing the multinational to subcontract in more than one country. In this way, adverse selection modelling outcomes justify, and are coherent with, the empirical evidence such as, the diversity of countries that multinational firms subcontract and the fast production relocation between countries.