Forecasting international tourist arrivals in South Korea: a deep learning approach

Abstract

Purpose This study aims to develop a robust long short-term memory (LSTM)-based forecasting model for daily international tourist arrivals at Incheon International Airport (ICN), incorporating multiple predictors including exchange rates, West Texas Intermediate (WTI) oil prices, Korea composite stock price index data and new COVID-19 cases. By leveraging deep learning techniques and diverse data sets, the research seeks to enhance the accuracy and reliability of tourism demand predictions, contributing significantly to both theoretical implications and practical applications in the field of hospitality and tourism. Design/methodology/approach This study introduces an innovative approach to forecasting international tourist arrivals by leveraging LSTM networks. This advanced methodology addresses complex managerial issues in tourism management by providing more accurate forecasts. The methodology comprises four key steps: collecting data sets; preprocessing the data; training the LSTM network; and forecasting future international tourist arrivals. The rest of this study is structured as follows: the subsequent sections detail the proposed LSTM model, present the empirical results and discuss the findings, conclusions and the theoretical and practical implications of the study in the field of hospitality and tourism. Findings This research pioneers the simultaneous use of big data encompassing five factors – international tourist arrivals, exchange rates, WTI oil prices, KOSPI data and new COVID-19 cases – for daily forecasting. The study reveals that integrating exchange rates, oil prices, stock market data and COVID-19 cases significantly enhances LSTM network forecasting precision. It addresses the narrow scope of existing research on predicting international tourist arrivals at ICN with these factors. Moreover, the study demonstrates LSTM networks’ capability to effectively handle multivariable time series prediction problems, providing a robust basis for their application in hospitality and tourism management. Originality/value This research pioneers the integration of international tourist arrivals, exchange rates, WTI oil prices, KOSPI data and new COVID-19 cases for forecasting daily international tourist arrivals. It bridges the gap in existing literature by proposing a comprehensive approach that considers multiple predictors simultaneously. Furthermore, it demonstrates the effectiveness of LSTM networks in handling multivariable time series forecasting problems, offering practical insights for enhancing tourism demand predictions. By addressing these critical factors and leveraging advanced deep learning techniques, this study contributes significantly to the advancement of forecasting methodologies in the tourism industry, aiding decision-makers in effective planning and resource allocation.