This study explores how online booking affects seasonality, measured as the variation in hotel bed-places net occupancy rate between peak and off-peak periods. We first develop a formal model illustrating that, as a result of the reduction in search costs brought about by the internet, competitive pressure strengthens. This effect is stronger in the peak period than off-peak, thus leading to an increase in seasonality associated to online booking. We then test our finding in a sample of 18 countries over the 1997–2007 span; the empirical results support the notion that the use of the internet causes an increase in seasonality. A set of policy implications conclude the work.

The Impact of Search Cost Reduction on Seasonality

BOFFA, FEDERICO;
2012-01-01

Abstract

This study explores how online booking affects seasonality, measured as the variation in hotel bed-places net occupancy rate between peak and off-peak periods. We first develop a formal model illustrating that, as a result of the reduction in search costs brought about by the internet, competitive pressure strengthens. This effect is stronger in the peak period than off-peak, thus leading to an increase in seasonality associated to online booking. We then test our finding in a sample of 18 countries over the 1997–2007 span; the empirical results support the notion that the use of the internet causes an increase in seasonality. A set of policy implications conclude the work.
2012
Internazionale
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/11393/112009
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