Search results

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

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.

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

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

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.

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.