A Lasso and Ridge-Cox Proportional Hazard Model Analysis of Thai Tourism Businesses’ Resilience and Survival in the COVID-19 Crisis

Abstract

This study aims to investigate the factors contributing to the survivability of Thai tourism businesses during the COVID-19 pandemic. In December 2021, a comprehensive survey was conducted among 400 tourism businesses across Thailand, coinciding with the heightening impact of the ongoing COVID-19 crisis. The study explores the perceptions of tourism businesses regarding the impact of COVID-19 and its influence on their chances of survival. To address this issue, the study employs the Lasso and Ridge Cox proportional hazards models. The findings reveal several significant factors. Firstly, businesses located in the Southern region, operating without physical premises and generating a substantial annual net income, face a lower risk of failure. Secondly, implementing strategies that prioritize consistent working hours and regular schedules, and reducing reliance on part-time employees, positively contribute to survival chances. Additionally, governments can effectively monitor high-risk businesses based on entrepreneurs’ perception of failure risk and offer targeted assistance. Moreover, businesses targeting domestic tourists and engaging in import and export activities within their supply chains demonstrate higher survivability rates. The availability of raw materials and entrepreneurs’ anticipation of a longer recovery time also play crucial roles in business survival. Government relief measures, such as tax relief and reduced Social Security Fund contributions, effectively increase the probability of business survival. Finally, timely adaptations and support within the initial period of from six months to a year are essential for building resilience in the face of challenges.