A study on the interrelationship among the industrial trends, corporate policies, and operating efficiency of international tourist hotels

Abstract

This study focuses on the interrelationships among the variables of industrial trend, business cycle, corporate policies, and operating efficiency (occupancy rate) of international tourist hotels in Taipei city. The empirical evidence indicates that a VAR (1) model is appropriate for describing the interrelationships among those variables, and the business cycle of tourism and the occupancy rate of the hospitality industry are the most efficient lagged explanatory variables for other variables in this model. We offer two primary suggestions for promoting the operating efficiency of international tourist hotels: For the authorities of Taiwan, the most important task is to balance what attracts foreign tourists with what will attract more business visitors by restructuring Taiwan’s industry cluster, developing new industrial parks, expanding exports of domestic factories, and growing international trade. For hotels, three steps are necessary to promote occupancy rate: reducing the degree of the hotel’s diversification of services offered and increasing the workforce in the rooms departments to attract more group guests, increasing the supply of the higher-rate rooms, and orienting more marketing policies toward foreign guests to attract more business visitors.