Abstract
This paper investigates the impact of the depreciation of the euro against the Swiss franc on tourism demand. The data consist of Swiss overnight stays in West Austrian ski resorts during the winter season. Using a panel error correction model, we found that the elasticity of tourism demand with respect to exchange rates is significantly larger than unity in absolute terms. In particular, the real exchange rate elasticity ranges between −1.5 using the dynamic panel data model and −2.2 for the long difference regression model. This indicates that Swiss winter tourists are highly sensitive to changes in exchange rates and relative prices. High elevation ski resorts benefit most from the depreciation of the euro against the Swiss franc. For Austrian ski resorts, tentative estimates suggest that the depreciation of the euro against the Swiss franc has led to an additional 173,000 overnight stays over the last four winter seasons.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
