Modeling the International Tourism Expenditures of Individual Travelers

This study presents a set of econometric models that measure the response of international tourism expenditures to consumer prices and other country-level factors, while controlling for the demographic characteristics of the individual travelers. We find that the price elasticity of the demand for international tourism services, conditional on traveling overseas, is approximately -0.8. We also find that the level of economic development of the country, its distance from the United States, and the age and income of the individual travelers all had significant positive effects on tourism expenditures.