PETŘÍČEK, Martin. Price elasticity in the market of accommodation services - empirical study in Berlin, Warsaw and Prague. In doc. Ing. Klára Antlová, Ph.D.; Mgr. Tereza Semerádová, Ph.D. Proceedings of the 14th International Conference Liberec Economic Forum 2019. Liberec: Technical University of Liberec, 2019, p. 238-246. ISBN 978-80-7494-482-6.
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Basic information
Original name Price elasticity in the market of accommodation services - empirical study in Berlin, Warsaw and Prague
Name (in English) Price elasticity in the market of accommodation services - empirical study in Berlin, Warsaw and Prague
Authors PETŘÍČEK, Martin.
Edition Liberec, Proceedings of the 14th International Conference Liberec Economic Forum 2019, p. 238-246, 9 pp. 2019.
Publisher Technical University of Liberec
Other information
Type of outcome Proceedings paper
Confidentiality degree is not subject to a state or trade secret
Publication form printed version "print"
Organization unit University College Prague – University of International Relations and Institute of Hospitality Management and Economics, Ltd.
ISBN 978-80-7494-482-6
Keywords in English price elasticity, demand, accommodation, revenue management
Tags International impact, Reviewed
Changed by Changed by: doc. Ing. Martin Petříček, Ph.D., učo 14750. Changed: 25/9/2019 16:43.
Abstract
The submitted paper focuses on the issue of price elasticity of demand for accommodation services between 2014 and 2018. The measurement of price elasticity is performed using a log-log regression analysis. This paper focuses on the markets in the capitals of Germany, Poland, and the Czech Republic, because these markets often have a similar customer base and represent exciting destinations for tourists to Central Europe. One of the results of this paper is that the demand for accommodation services in all monitored destinations is inelastic. This means that a percentage change in price leads to less than one percent change in quantity demanded. This price inelasticity can be a significant indicator of how to change prices in the markets in general so that companies can increase their revenue. The research also shows that we can follow a decreasing trend of price elasticity in the long term. In the past two years, we can also argue that Berlin is showing an increase in the price elasticity of the demand, thus distinguishing it from the other two markets. The results of this research provide background for further analysis and also as input for a detailed study of consumer behavior. Understanding this fundamental feature of consumer behavior (i.e., price-sensitivity) is absolutely necessary for the correct pricing, which is the primary prerequisite for the market of accommodation services to enable companies to increase their expected revenue.
Abstract (in English)
The submitted paper focuses on the issue of price elasticity of demand for accommodation services between 2014 and 2018. The measurement of price elasticity is performed using a log-log regression analysis. This paper focuses on the markets in the capitals of Germany, Poland, and the Czech Republic, because these markets often have a similar customer base and represent exciting destinations for tourists to Central Europe. One of the results of this paper is that the demand for accommodation services in all monitored destinations is inelastic. This means that a percentage change in price leads to less than one percent change in quantity demanded. This price inelasticity can be a significant indicator of how to change prices in the markets in general so that companies can increase their revenue. The research also shows that we can follow a decreasing trend of price elasticity in the long term. In the past two years, we can also argue that Berlin is showing an increase in the price elasticity of the demand, thus distinguishing it from the other two markets. The results of this research provide background for further analysis and also as input for a detailed study of consumer behavior. Understanding this fundamental feature of consumer behavior (i.e., price-sensitivity) is absolutely necessary for the correct pricing, which is the primary prerequisite for the market of accommodation services to enable companies to increase their expected revenue.
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