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The complexity and the tourism market structure is endogenous evolution
Author: MaMingCao
Tutor: WengZuo
School: Fudan University
Course: Tourism Management
Keywords: tourism market structure endogenous evolution of market structure complexity Jiangnan ancient water towns tourism market
CLC: F592
Type: Master's thesis
Year: 2012
Downloads: 117
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Abstract
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Drawing on industrial organization theory and complex system thinking, this research aims to explore the endogenous formation and evolution mechanism of the market structure of the Jiangnan ancient water towns’tourism market, by the methods of empirical studies and computational simulation.Since the1980s, with the rapid development of domestic tourism market, the destinations’number and the tourist scale of ancient water towns has grown fast and the market has formed a pattern with six largest ancient water towns as dominators.Empirical studies show that the salient feature of the Jiangnan ancient water towns’tourism market is the coexistence of a highly concentrated structure and excess profits. On the one hand, the destinations number of ancient water towns has increased continuously as a result of the expanding market capacity and the attractive excess profits; on the other hand, the increase of the destinations number has not made the market fragmented, with the concentration rate of the six largest ancient water towns approaching80%in2010. Moreover, some potential ancient water towns with qualified resource have not entered the market yet. Therefore, this paper’s core issue is what are the endogenous formation and evolution mechanism of the market structure, as well as its complex evolutionary features, of the market structure of the Jiangnan ancient water towns’tourism market.The author argues that the interaction of the market capacity and scale economy is the critical mechanism of the structural formation and evolution of the Jiangnan ancient water towns’tourism market. Specifically, the expansion of the market capacity contributes to the increase of the destinations number; while the high fixed costs investment limits the increase of that. Thus, the tradeoff of these two contrary forces decides the market structure’s evolutionary trend.From the perspective of complex system thinking, there are three prominent features in the evolution of the market structure of the Jiangnan ancient water towns’ tourism market. The first feature is the lock-in of the highly concentrated market structure, which is mainly because of the effects of scale economy caused by the inputs of fixed costs and the marketing costs. The second feature is the persistence of the first-movers’dominant position, which results from the self-reinforce and accumulation of the first-movers’advantages. The third feature is the uncertainty of the market structure’s evolution, that is, the historical events’impacts on the structural evolution as well as their unpredictable and uncontrollable characteristics mean that the uncertainty prevails in the evolution process of the Jiangnan ancient water towns’ tourism market.Finally, combining the actual situation, this paper presents some strategies recommendations to promote the development of the ancient water towns tourism. For mature ancient water towns, it suggests that the re-development strategy with the object of improving the destinations images will contribute to the sustainability of competitive advantages. For the potential ancient water towns, it suggests that the big push strategy with the target of creating new brands will help them develop towards a high-level equilibrium.
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