International Journal of Contemporary Hospitality Management, Volume 27, Issue 1, February 2015.
Purpose This paper investigates the determinants of dynamic efficiency in the Spanish hotel industry. The study introduces a large number of variables potentially related to efficiency and performance measurement. In particular, we explore the association between efficiency scores and firm specific factors (variables related to market conditions, business factors, audit variables, organisational forms and subsidiary variables). Design/methodology/approach In this study, we use the Data Envelopment Analysis (DEA) double frontier approach according to firm size in conjunction with non-parametric tests (Mann–Whitney U and Kruskal-Wallis tests), a dynamic Tobit regression model and a bootstrapping procedure. We perform our tests using 1,805 hotels from the years 2002-2011. This allows us to overcome several of the major limitations of previous papers, namely, the low number of observations, the static or cross-sectional analysis referring to a single period, and the use of conventional DEA models, among others. Findings The results show significant differences in dynamic efficiency among Spanish hotel companies. In addition, the evidence suggests the levels of efficiency are related to the hotel´s location, the hotel´s size, internationalisation, the first source of the hotel´s activity, audit service and management variables. Research limitations/implications One limitation of the study is related to the input and output variables specified in the DEA model. The selection of inputs and outputs was based on data availability and the previous literature on hotel efficiency, but the results might change if the hotel sample and the selected input and output variables were changed. Another limitation is the availability of data on ownership structure and subsidiary variables for very small businesses. Originality/value The paper contributes to the tourism literature by offering new insights into hotel performance: dynamic efficiency evaluation and its main determinants. The paper presents strategic market implications for hoteliers, government decision-makers and destination management organisations.
Purpose This paper investigates the determinants of dynamic efficiency in the Spanish hotel industry. The study introduces a large number of variables potentially related to efficiency and performance measurement. In particular, we explore the association between efficiency scores and firm specific factors (variables related to market conditions, business factors, audit variables, organisational forms and subsidiary variables). Design/methodology/approach In this study, we use the Data Envelopment Analysis (DEA) double frontier approach according to firm size in conjunction with non-parametric tests (Mann–Whitney U and Kruskal-Wallis tests), a dynamic Tobit regression model and a bootstrapping procedure. We perform our tests using 1,805 hotels from the years 2002-2011. This allows us to overcome several of the major limitations of previous papers, namely, the low number of observations, the static or cross-sectional analysis referring to a single period, and the use of conventional DEA models, among others. Findings The results show significant differences in dynamic efficiency among Spanish hotel companies. In addition, the evidence suggests the levels of efficiency are related to the hotel´s location, the hotel´s size, internationalisation, the first source of the hotel´s activity, audit service and management variables. Research limitations/implications One limitation of the study is related to the input and output variables specified in the DEA model. The selection of inputs and outputs was based on data availability and the previous literature on hotel efficiency, but the results might change if the hotel sample and the selected input and output variables were changed. Another limitation is the availability of data on ownership structure and subsidiary variables for very small businesses. Originality/value The paper contributes to the tourism literature by offering new insights into hotel performance: dynamic efficiency evaluation and its main determinants. The paper presents strategic market implications for hoteliers, government decision-makers and destination management organisations.