High unemployment and tourism participation

Abstract

[eng] This paper analyses individual tourism participation decisions during a</p><p>worldwide economic downturn. Given the nature of tourism services, a</p><p>reduction in habitual consumption is highly probable during an</p><p>economic crisis. Since the unemployment rate is strongly correlated with</p><p>the economic cycle, the hypothesis that is discussed concerns whether</p><p>residents’ decision to participate in tourism is affected by their region’s</p><p>level of unemployment. More specifically, it is suggested that</p><p>unemployment not only affects the tourism participation decision of</p><p>those who are out-of-work, but that aggregate unemployment (measured</p><p>as the region’s unemployment rate) also has a bearing on such decisions</p><p>made by individuals in general. The results that were obtained for a set</p><p>of EU countries show that the unemployment level has a positive effect</p><p>on the probability of not going on holidays. This effect emerges when</p><p>there is an unemployment rate of over 10%.</p>