Elasticities relevant to tourism in Scotland: evidence review

1 Introduction

This report aims to conduct a systematic literature review to provide a thorough and up-to-date overview of the existing estimates of the potential price elasticities of demand (PED) and income elasticities of demand (YED) for tourists to destinations that may be relevant to Scotland, and those using commercial accommodation; price elasticities of supply (PES) of commercial accommodation relevant to Scotland; and other factors influencing changes in demand and supply in tourism. This report also reviews the studies on behavioural changes as a result of tourist taxation.

To achieve this aim, this report seeks to answer the following research questions:

• What evidence, of relevance to Scotland, is available in this area?
• What are the main findings from this evidence base?
• What is the breadth, depth, and timeliness of this evidence base?
• What are the most important limitations and gaps in the existing evidence base?
• How might the evidence base be developed?

This report is intended to support policymakers' understanding of the potential responsiveness of visitors and tourism businesses to changes in prices of goods and services associated with tourism, with findings from destinations with similar conditions to those found in Scotland. This evidence base will be of interest to those involved in analysis and policy debate around tourism in Scotland.

The rest of the report is organised as follows: Section 2 describes the methodology of the search strategy for literature review and cluster analysis employed to identify relevant destinations to Scotland. Section 3 reviews the elasticities extracted from the literature. Section 4 reviews the literature on behavioural changes as a result of tourist taxation. Section 5 concludes the report.