Applicability of agglomeration to tourism economics

This study examines the applicability of the agglomeration effect to tourism economics. As such, we test the hypothesis that tourists preferences include a “love of variety.” To test the hypothesis, we propose a theoretical model of tourists' destination choices based on the Dixit-Stiglitz model of monopolistic competition, and use regional data on Japanese tourists for the empirical analysis. Here, we define the number of genres as the variety of tourism goods. The results show that the number of genres offered by destinations affects tourists' destination choices. In other words, tourists' preferences exhibit a love of variety.