Prices of short-stay accommodation: time series of a eurozone country

Abstract

Purpose

This paper aims to provide a reliable statistical model for time-series prices of short-stay accommodation and overnight stays in a eurozone country.

Design/methodology/approach

Exploiting the unit root feature, the cointegrated vector autoregressive model solves the problem of misspecification. Subsequently, variables are modelled for a long-run equilibrium with included deterministic variables.

Findings

The empirical results confirmed that overnight stays for foreign tourists were positively associated with the prices of short-stay accommodation.

Research limitations/implications

The major limitation lies in the data vector and its time horizon; its extension could provide a more specific view.

Practical implications

Findings can assist practitioners and hotel executives by providing the information and rationale for adopting seasonal volatility pricing. Structural breaks in price time-series have practical implications for setting seasonal-pricing schemes. Tourists could benefit either from greater price stability or from differentiated seasonal prices, which are important in the promotion of the price attractiveness of the tourist destination.

Originality/value

The originality of the paper lies in the applied unit root econometrics for tourism price time-series modelling and the prediction of short-stay accommodation prices.

Citation

Gričar, S. and Bojnec, Š. (2019), "Prices of short-stay accommodation: time series of a eurozone country", International Journal of Contemporary Hospitality Management, Vol. 31 No. 12, pp. 4500-4519. https://doi.org/10.1108/IJCHM-01-2019-0091