Using the Hedonic Price Model to Examine the Impact of Location on Room Rates in the East Black Sea Region (TR9)

Abstract

Despite the destructive impact of the Covid-19 Pandemic, tourism is one of the Turkey’s dynamic and fastest growing sectors. In recent years, the sector started to attract visitors for alternative forms of tourism such as sports, health and nature tourism. Lately, the East Black Sea Region (TR9) is preferred by outdoor sports and nature enthusiasts. The constant growth in tourist arrivals and overnights have increased both supply and demand for tourist accommodation which is considered as a differentiated product in terms of pricing. There is a variety of attributes or 'characteristics' on the rates charged for hotel rooms. To this end, this study aims to seek the attributes that influence the overall prices of tourism facilities using hedonic price methods. The particular impact of location on room rates is investigated. The results show that star category, hotel and room size, parking, beach, and Arabic speaking staff are significantly associated with room rates. Moreover, tourists are willing to pay more for accommodations that are close to the airport and visiting sites which are mostly located in highlands in the region. Therefore, the location of accommodation establishments in the region explains the price differences in terms of accessibility and site selection. The results would be useful for hotel managers and local policy-makers in order for design their pricing policies to attract more tourists to the region.