Destination performance: Introducing the utility function in the mean-variance space

Zhang, Linjia and Botti, Laurent and Petit, Sylvain (2016): Destination performance: Introducing the utility function in the mean-variance space. Published in: Tourism Management , Vol. 52, (2016): pp. 123-132.

Abstract

Economic characteristics of home countries can cause considerable variations in the tourism demand. For example, the average level of expenditure per tourist varies from one origin to another and these variations may alter overtime. Thus different tourist nationalities are associated with different level of expenditures and risks. Therefore strategies aimed at minimizing the variations may become an important issue for the policy makers. In this paper, we aim to use the productivity measurement theory in a mean-variance space to a French region (Nord Pas-de-Calais) by introducing the utility function in a mean-variance framework. With this method, we can calculate the optimal portfolio share for each origin and give some useful political advices to the policy decision makers to improve the performance of the tourist sector.

• Item Type: MPRA Paper
• Language: English
• Keywords: Productivity measurement; Mean-variance; Tourism efficiency; Efficiency decomposition; Utility function; Nord Pas-de-Calais
• Subjects: C - Mathematical and Quantitative Methods > C6 - Mathematical Methods ; Programming Models ; Mathematical and Simulation Modeling > C61 - Optimization Techniques ; Programming Models ; Dynamic Analysis; C - Mathematical and Quantitative Methods > C6 - Mathematical Methods ; Programming Models ; Mathematical and Simulation Modeling > C67 - Input-Output Models; L - Industrial Organization > L8 - Industry Studies: Services > L83 - Sports ; Gambling ; Restaurants ; Recreation ; Tourism

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