Abstract
The Balearic Islands are one of the Mediterranean's top tourist destinations. Indeed, the tourist industry is the driving force behind the economy of the archipelago. This paper analyses the earning capacity of the Balearic tourist industry so as to detect improvements that should be made to ensure higher competitiveness. The results show that the current reduction in its earning capacity could be offset through the introduction of new formulae that take advantage of new tourism demand trends and by using innovative instruments in tourism processes.
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