Appropriate policies towards multinational hotel corporations in developing countries

Abstract

Despite the prevalence of international hotel chains in the tourism sector of developing countries, little research has been carried out on the structure of the industry, the sources of the competitive advantages of the hotel chains over indigenous hotels, reasons for the alternative forms of involvement of the hotel chains and deriving from this, their potential and actual impact on host countries. This article applies theories developed for the multinational enterprise in the manufacturing sector, to original data and observations on the international hotel industry. Given the state of the art and the limited information on the impact of MNE hotels, the paper is principally concerned with generating potentially useful hypotheses for consideration by host governments and to provide a framework for further research. Certain policy conclusions however, are drawn from the analysis, especially regarding the appropriate from of involvement by the international hotels.