Tourism, Security and Safety From Theory to Practice

Figure 1
Hotel bed nights In Israel, 1987–1999, annual basis.
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between the two markets and between supply and demand in each market. To facil-
itate the discussion, the following variables are used, based on time period 
t
:
PL
t
Mean monthly price charged to local (Israeli) tourists, in US dollars per
bed night
PF
t
Mean monthly price charged to foreign (international) tourists, in US dol-
lars per bed night
QL
t
Bed nights sold to Israeli visitors, thousands per month
QF
t
Bed nights sold to foreign visitors, thousands per month
GNPL
t
Israeli GNP, billions of US dollars per month
GNPF
t
Weighted mean GNP in foreign visitors’ countries-of-origin, billions of
US dollars per month
SCL
t
Average expenditure on Israelis’ travel to non-Israeli destinations, in US
dollars per person-trip
SCF
t
Average expenditure on foreigners’ travel to non-Israeli destinations, in
US dollars per person-trip
TER
1-k
Index of magnitude of terrorist or related political event, 
−
9.0 to 9.0 (
k
is
lag length)
S
A vector of seasonal (bi-monthly) dummy variables
In the local market, demand quantity QL
t
d
should depend on Israeli hotel rates
charged to Israelis (PL
t
), on aggregate Israeli income (GNPL
t
), on hotel and other
travel costs charged to Israelis at sites outside Israel (SCL
t
), and on seasonal fac-
tors 
S.
Foreign demand quantity QF
t
d
would depend on Israeli hotel rates charged
to foreigners (PF
t
), on hotel and other travel costs charged to foreign visitors at
sites outside Israel (SCF
t
), on seasonal factors 
S,
and on the appropriately lagged
terror index TER
1-k
. We have then
Tourism Security and Safety: From Theory to Practice
52
0%
10%
20%
30%
40%
50%
60%
70%
1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999
Year
Total
Foreign
Local