FISCAL ASPECTS OF THE LEISURE TRAVEL AND TOURISM MARKET
Selected aspects of financial management in the leisure travel and tourism market are examined. The perspective from which the selected aspects of financial management are investigates is that of a travel agency. The specific aspects of financial management in the leisure travel and tourism market examined are as follows: (1) industry and market growth; (2) effects of airline deregulation on the travel and tourism market; (3) recent conflicts between travel agencies and commercial airlines; (4) responses by travel agencies to changes made by commercial airlines in commission schedules; (5) effects of monetary policy on the travel and tourism industry; (6) financial analysis of a specific travel agency as an illustration of financial performance within the industry; and (7) performance of travel agencies in the financial markets; again using a specific travel agency for purposes of illustration.
Leisure travel and tourism are heavily dependent upon economic growth in the developed economies. Tourism is a major industry on a worldwide basis (Frechtling, 1991). For many small, developing countries, tourism is a major source of income. For major industrial countries, such as Canada, Japan, the United States, and Western European countries, income from tourism is an important source of income (Goodrich, 1991).
Travelers from the United States comprise the largest national segment of the worldwide tourism industry. Thus, when in the wake of terrorist activities, war, a troubled economy, and other events directed at or affecting Americans, tourism by Americans declines substantially, adverse economic effects are felt around the world in the travel and tourism industry (Williams & Shaw, 1992).
Prior to 1973, tourism was a major growth industry on a worldwide basis. The energy crises of 1973-1974 and 1979-1980 increased the costs of travel significantly because of jet ...