Do hotel business benefit from increased tourist accessibility? Evidence from China’s high-speed railway program

Abstract

The operation of high-speed railway (HSR) always plays a key role in promoting tourism development of city by improving transportation accessibility and facilitating tourists’ travel. Based on the panel data of 50 major tourist cities in China from 2010 to 2017, this article uses a Tobit model to explore the impact of HSR service on hotel performance that is embodied in occupancy rate. The results show that with other factors unchanged, the cities with a high-frequency HSR service system or hub HSR station tend to have higher hotel occupancy rate. Moreover, the hotel occupancy rate of cities with a suburb HSR station is lower than that of other HSR-served cities. After classifying hotels into luxury and budget groups, this article finds that HSR train frequency and station grade still show positive effects on both luxury and budget hotels. However, in cities with suburb HSR stations, budget hotels tend to have lower occupancy rates, while occupancy rate for luxury hotels shows no significant difference.