Drivers and barriers to entry for new hotel start-ups

This paper quantifies the impact of location attributes on hotel creation by identifying drivers and barriers to entry in the Spanish hotel sector. The methodology is based on the use of count models. The efficiency of labour in a tourist destination is a driver of new hotel start-ups, but the initial investment and idle capacity are relevant barriers to entry. Regarding the existence of externalities, the incumbents' effect on new hotel start-ups depends on their behaviour and average age in the tourist destination.