Microsoft Word 2007 ichrie conference Proceedings Final-Final 06-06-07. doc

LITERATURE REVIEW 
Two groups of references are relevant to this research in the literature. One is about package holidays and 
enterprises (e.g. tour operator, theme park, and hotel & accommodation provider). The other is about applying Game 
Theory in studying supply chain management. After reviewing the references in these two groups, this paper seeks 
to establish a game-theoretic approach to studying collaboration and competition dynamics in TSCs for package 
holidays. 
Past researches on package holiday mainly focused on identifying its distinctive characters. Wang, Hsieh, 
and Huan (1999) identified the critical service features of the package holiday by interview questionnaire of both 
customers and employees. Twenty five grounded service features are concluded and categorized into nine sectors 
including pre-tour briefing, airport/plane, hotel etc. Those features were suggested to be used to improve holiday’s 
quality as measures. Based on a questionnaire survey, Corcoran, Gillmor, and Killen (1996) pictured the general 
characteristics of package tourists from Dublin Airport. Influences affecting the choice of holiday were explored. 
The relationships between the holiday destination, the holiday choice and booking processes and previous package 
holiday experiences were statistically tested. 
Tour operators have enormous influence over activities throughout package holidays, since they directly 
influence the volume of tourism (Aguiló, Alegre, and Sard, 2002), facilities tourists used (Klemm and Parkinson, 
2001) and sustainable tourism development (Curtin and Busby 1999; Budeanu 2005; Tepelus 2005) etc. Taylor 
(1998) argue that tour operators adopted mixed strategies when setting brochure prices, even if achieved 
unconsciously through the application of rules of thumb. Using econometric analysis of a panel-data set, Davies and 
Downward (1998) concluded that U.K. package tour industry is segmented according to the size of tour operators. 
Their results suggested that it’s difficult to support the contestability market hypothesis. Taylor (1998) introduced a 
game matrix analyzed tour operator’s mixed price strategy. Aguiló, Alegre, and Sard (2002) analyzed the prices of 
package holiday in German and U.K. tourism industries. They asserted that tour operator market had an oligopolistic 
feature. 
Theme park is the main motivation and attraction for tourists to take their package holidays. Braun and 
Soskin (1999) observed substantial alteration in both industry structure and overall market environment in the 
central Florida theme park industry. They argued that market structure changed from monopoly to oligopoly. 
Moreover, the prices strategies of theme parks had become more stable when industry continued to mature. 
Kemperman (2000) proposed a theoretical framework to analyze theme park visitor choice processes for theme park 
planning research. 
Hotel & accommodation sector is a fundamental element of package holiday product (Sharpley 2000). 
There has been a large number of literature in this area, such as issues on quality (Ekinci Y., Prokopaki P., and 
Cobanoglu C. 2003; Wang F. C. and Shang J. K. 2006; Benítez J. M., Martín J. C., and Román C. 2006), sustainable 
development (Marin C. and Jafari J. 2002; Warnken J., Bradley M., and Guilding C. 2005), etc. For our search 
purpose, we limit our attention on competitive behavior of enterprises. Baum and Mudambi (1995) presented 
theoretical analyses of oligopolistic hotel pricing strategies. The data illustrated that during periods of excess supply, 
prices are well-behaved. However, during periods of excess supply, prices are unrepresentative of the state of 
demand. Marvel (1999) investigated competing in the senior market for hotel services. Four critical factors were 
identified, and current approaches of hotels to senior market were examined. Chung (2000) examined pricing 

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