Abstract

The purpose of this research was to analyze the determinants of tourism expenditures in the local governments. To empirically analyze the research model constructed on the expenditure determinants theory and the punctuated equilibrium theory. The last 7 years’ panel data were gathered from a total of 128 local primary governments that host a cultural tourism festival, and were classified into four groups according to the type of festival and level of locality for analysis. The research results showed that the local tourism expenditures were determined based on the irrational category. Meanwhile, the variables associated with financial ability and tourism demand which was regarded as a rational category did not create any significant influences. These results suggest that local primary governments lack consistency and systematization with tourism budgeting system. Therefore, this study proposed that local governments should adopt the demand-oriented system of expenditure determination.

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