Hotel Revenue Convergence: Evidence Across Star Hotels in Chinese Provinces

Area of Science:

• Economics
• Tourism Management
• Regional Science

Background:

• Hotel revenue patterns are crucial for understanding regional economic development.
• Previous studies have not comprehensively analyzed Chinese hotel revenue convergence.
• China's vast and diverse provincial landscape presents unique economic dynamics.

Purpose of the Study:

• To analyze hotel revenue convergence patterns across Chinese provinces.
• To identify the drivers behind observed revenue divergence and convergence.
• To provide actionable insights for tourism policymakers in China.

Main Methods:

• Club clustering methodology applied to a unique dataset of all Chinese hotels.
• Econometric analysis to identify factors influencing revenue patterns.
• Comparative analysis of provincial-level hotel revenue data.

Main Results:

• Hotel revenues exhibit a diverging pattern nationally.
• Specific provincial groups show a converging revenue trend, forming 'clubs'.
• Productivity trends, management strategies, and tax policies significantly influence these patterns.

Conclusions:

• Chinese hotel revenue dynamics are complex, with both diverging and converging elements.
• Targeted policies addressing productivity, management, and taxation can foster convergence.
• Findings support evidence-based policymaking to enhance the Chinese hotel industry's global competitiveness.