This paper analyzes the responsiveness of Thai outbound tourism to East Asian destinations,
namely China, Hong Kong, Japan, Taiwan and Korea, to changes in effective relative price of
tourism, total real total tourism expenditure, and one-off events. The nonlinear and linear Almost
Ideal Demand (AID) models are estimated with monthly data to identify the price competitiveness
and interdependencies of tourism demand for competing destinations in both long run (static) and
short run error correction (dynamic) specifications. The homogeneity and symmetry restricted
long run and short run AID models are estimated to calculate elasticities. The income elasticities,
and the compensated and uncompensated own-price and cross-price elasticities, provide useful
information for public and private tourism agents at the various destinations to maintain and
improve price competitiveness. The empirical results show that price competitiveness is important
for tourism demand for Japan, Korea and Hong Kong in the long run, and for Hong Kong and
Taiwan in the short run. With regard to long run cross-price elasticities, the substitution effect can
be found in the following pairs of destinations: China-Korea, Japan-Hong Kong, Taiwan-Hong
Kong, Japan-Korea, and Taiwan-Korea. In addition to the substitution effect, the complementary
effect can be found in the following pairs of destinations: China-Hong Kong, China-Japan, China-
Taiwan, Japan-Taiwan, and Korea-Hong Kong. Contrary to the findings obtained from the long
run AID specification, Japan-Korea and Taiwan-Korea are complements in the short run.
Furthermore, the real total tourism expenditure elasticities indicate that China's share of real total
tourism expenditure is inelastic in response to a change in real total tourism expenditure, while
Korea's share of real total tourism expenditure is most sensitive to changes in expenditure in the
long run. The greatest impact on the share of real total tourism expenditure in the short run is
tourism demand for Taiwan.
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