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Economies of Scale and Scope in the Taiwan Tourism Industry
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Economies of Scale and Scope in the Taiwan Tourism Industry
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Journal Article
Economies of Scale and Scope in the Taiwan Tourism Industry
1996
Overview
Based on a 1989 survey of Taiwan's tourism industry, iterative SUR results of the model of translog multiproduct cost and factor share equations show that travel agents of simultaneously operating outbound service and agent service do, in general, enjoy product-specific economies of scale and ray economies of scale, and do not enjoy weak cost complementarities. However, small-to-medium-sized travel agents of the above product mix do enjoy weak cost complementarities and economies of scope while large-sized firms still do not enjoy weak cost complementarities. Therefore, this paper suggests that small-to-medium-sized travel agents can pursue diversification, and large-sized ones can pursue specification to promote cost efficiency.
Publisher
National Taiwan University Press, NTU College of Management
Subject
