The tourism area lifecycle and regime switching models

The area lifecycle concept postulates that a destination should enjoy varying levels of popularity over time and, as a result, the growth in arrivals should follow an s-shaped path. To test the concept, this study uses Markov-switching models and quarterly observations for Barbados over the period 1957-2002. The key finding of the paper is that the framework does adequately represent the growth in arrivals from individual markets. However, there does not exist a common lifecycle relationship, which is applicable to all source markets. This suggests that policies aimed at rejuvenating growth for a particular destination should take into account the specific peculiarities of individual source markets.