Determinants of inbound tourism demand in Tanzania.

The study investigates the determinants of inbound tourism demand both at macro and micro levels. At macro level the study investigates the determinants of the number of tourist arrivals, while at micro level the study investigates the determinants of the per capita expenditure of tourists, their length of stay and their choice of a package tour. In achieving the first objective, panel data regression analysis was employed using the number of arrivals obtained from the Ministry of Tourism and Natural Resources (1995-2007) as well as a number of covariates from different sources. Regarding the determinants of tourists’ per capita expenditure, an OLS was applied on a cross-section of tourists surveyed in the years 2001, 2007 and 2008. As for the length of stay, a survival analysis was employed, whereas for the choice of a package tour a binary logistic regression was used, in each case using the cross-section data of the years 2001, 2007 and 2008. Among the key findings is that non price factors (such as the country’s economic development) are more influential than price factors in attracting tourists to Tanzania. Trip-related characteristics of the tourists such as purpose of visit and the number in travel party were found to be the most influential variables in explaining tourists’ daily spending, length of stay and choice of package tour. To promote the number of arrivals it is implied that the government should invest more in the non-price factors such as infrastructure whereas to enhance micro demand, promotion organs and other stakeholders should attune their marketing strategies more to trip-related characteristics of the tourists than to other factors.

Transformation for Improved livelihoods (PANTIL)