Page 57 - Azerbaijan State University of Economics

THE JOURNAL OF ECONOMIC SCIENCES: THEORY AND PRACTICE, V.77, # 1, 2020, pp. 51-64

Established at one level, the total amount of income from international tourism does
not mean its stability in a number of regions of the world. Thus, in the last three
years (2014 - 2016), there has been a significant decline in revenues from
international tourism in France (by 27.3%, minus $ 15.866 billion), Italy (by 11.5%,
minus $ 5.242 billion, United Kingdom (by 14.9%, minus $ 6.924 billion), Turkey
(by 36.6%, minus $ 10.809 billion) and a number of other countries in the European
continent and North Africa (in Egypt, the drop in revenues from international
tourism is 2.6 times) (Alexandrova, 2002: 7-8).

Ferrer-Rosell, Coenders, Mateu-Figueras and Pawlowsky-Glahn study demand in a
different context. Here, in the first instant the authors analyse micro level data of
tourism expenditure using a novel approach to determine the factors influencing
absolute expenditure on transportation. In the second step, they analyse the relative
importance of this expenditure compared to the budget share of other items
constituting the tourism spending. They find that characteristics such as travel group
size, age, income and professional status is important in determining the absolute
expenditure on transport. However, the characteristics which influence the budget
share of transportation are education, income, country of residence, travel group and
professional status. The authors include passengers of low cost airlines only
(Seetaram, 2016: 205-206). Pricing and competition is central in the paper by
Abrate, Viglia, García and Forgas-Coll, who study the competitive behavior of high-
speed trains and airlines in a dynamic context. They provide an explanation of
simultaneous price adjustments by firms in the short run taking into account
intermodal and intermodal price competition on the Rome-Milan route. The data
reveal asymmetric responses between the two modes of transport. Airline companies
are found to display higher reactions to changes in the price of the competitors than
the high-speed trains. Furthermore, it is observed that traditional carriers have
independent pricing strategies while low cost airlines, consider the tactics of full

service airlines when taking decisions regarding airfares (Seetaram, 2016: 205-206).
Studies show that, in general, the development of the tourism sector, including rural
tourism, is considered one of the significant and profitable areas for the state. In this
direction, Azerbaijan has adopted a state program for the development of tourism,
which directly affects the development of the country's economy. In state program it
is intended the raising of socio-economic states of the regions and it is also intended
the new directions of rural tourism and the expansion of its scale all over the
republic. Therefore the state should establish its policy on the sphere of developing
the rural tourism according to the traditions of the village. It is also reasonable to
organize the tourism enterprises in the rural areas using marketing strategy and to
apply medium and high income tourism sector segments as well.

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