Evaluation of Agritourism Activity in Italy: Facility Based or Local Culture Based?

Abstract

This paper identifies which diversified activities influence the price level of agritourism and how they do so. A hypothesis that contrasts two types of activity (facility based and local culture based) is examined. First, from a conceptual perspective, the authors note that agritourism based on local cultural resources can internalize positive externalities, which are uniquely nurtured local cultural resources, into income – unlike facility based activity that has no connection with local cultural resources. Second, the results of estimations from a price determinant ordered logit model demonstrate that owning a swimming pool is the most common and influential factor in enhancing the price level, while regional diversity is observed in local cultural resource based activities such as restaurants, World Heritage Sites and DOC wines. These findings indicate that hardware based evolution is more effective in the short term than evolution based on software. Nevertheless, this hardware based evolution of agritourism is founded implicitly on an assumption of continuously growing demand and sufficient financial capability for the fixed investment. When growth in demand becomes stagnant, facility installation can be a heavy burden on operators. Consequently, for the sustainable development of agritourism, it will be necessary to harness the locality so as to create a balance between facility based services and local culture based services.