The Challenge of Regional Tourism Demand Forecasting

Abstract

This study forecasts international arrivals to regional China, using international guest arrival data at accommodation establishments in 31 regional provinces. The research takes tourism forecasting into a new and significant area of study by examining intra country regional forecasting. The objective is to determine whether regional forecasting models can be used, in responding to demand from regional governments and industry in China to accurately forecast international regional tourist arrivals that increasingly underpin the success of tourism development. The study examines whether modern techniques (Basic Structural and Time Varying Parameter Models) can accurately forecast international regional arrivals with regional data. A significant contribution is testing theory for selecting new explanatory variables specific to regional tourism, which are different from those used in national forecasting. The conclusions are that regional forecasting can be accurate though not always using an econometric method, and regional forecasts are a practical management tool.