Using a Two-Stage DEA Model to Measure Tourism Potentials of EU Countries and Western Balkan Countries: An Approach to Sustainable Development

Abstract

The concept of sustainable tourism development is imposed as an inevitable way of improving the tourism industry as a whole. This study tries to offer an adequate inclusion of sustainable factors in overall tourism development efficiency results. Through the detection and estimation of potential sources of efficiency, the paper will do the efficiency benchmarking of tourism services on the level of countries as destinations. In order to complete the task, data collection was focused on 27 EU countries and five Western Balkan countries over the period from 2011 to 2017. This paper utilized an output-oriented data envelopment analysis (DEA) procedure to estimate efficiency scores for each country, and a panel data Tobit regression model to emphasize the (in)significance of each individual tourism development indicator. The results in the first stage show relatively high-efficiency scores, particularly in the case of EU 15 countries and with room for improvement in the case of the others. The second stage reveals positive and significant effects on relative tourism efficiency by the sustainability of tourism development, the share of GDP, tourist arrivals and inbound receipts, as well as visa requirements and rate of use. Policymakers should gradually take control of the mentioned variables to protect the interests of all relevant stakeholders involved in the tourism development process.

Efficiency of Tourism Development: Application of Dea and Tobit Model

“…The highest average efficiency is mainly achieved by the EU15 countries, while the countries that joined EU later showed the lowest average efficiency (values around 0,48) of tourism development in the observed period. This conclusion is consistent with similar previous research (Radovanov et al 2020). The values of the average efficiency score are very constant for the group of New member states, while Western Balkan countries and EU15 show a significant increase of efficiency score during the observed period.…”

“…The retention of international tourists in one country through the diversity of tourism offer is reflected through the amount of money spent during their stay. The coefficients of tourism industry share in GDP and employment remain significant and positive with overall tourism efficiency results, presenting that observed countries that pay special attention to the tourism industry are more efficient (Radovanov et al, 2020). The growth of the economic level and the technological progress will cause the elevation of tourism efficiency overall (Liu et al, 2017).…”

“…The number of rooms is normally a prerequisite for a great number of tourist arrivals, but in this sample of the observed countries, it is negatively related to the tourism efficiency. On the other hand, the coefficient concerning relation between the rate of use and tourism efficiency is positive and significant at the level of 5%, showing the meaning of better usage of existing tourist facilities (Radovanov et al, 2020). Finally, the number of natural heritage sites can be an issue of significant increase of tourism efficiency involving and protecting all relevant stakeholders in the tourism development process.…”

Business Performance and Sustainability in Cultural and Rural Tourism Destinations

“…Recent empirical papers have focused on the relationship between the efficiency index and sustainable practices at the firm level [6] or regional or country level [17,18]. In the empirical strategy, it is common to develop a second stage to assess the efficiency determinants [6,17,18].…”

“…Recent empirical papers have focused on the relationship between the efficiency index and sustainable practices at the firm level [6] or regional or country level [17,18]. In the empirical strategy, it is common to develop a second stage to assess the efficiency determinants [6,17,18]. The competitiveness and business success of rural destinations with a sustainable perspective have been addressed in several papers [19,20] as well as the efficiency evaluation in cultural destinations [21][22][23].…”