ERBE 03 1 04
The Risk Structure of Portuguese Tourism Industry Subsectors: A PLS-SEM Approach
RUI COSTA 
a; ANTÓNIO C. MOREIRA a,b ; JORGE MOTA a,b ; ADRIANA F. CHIM-MIKI a
a GOVCOPP – Research Unit on Governance, Competitiveness and Public Policies; and Department of Economics, Management, Industrial Engineering and Tourism, University of Aveiro, Portugal, b CICEE – Research Center in Economics & Business Sciences, Lisbon, Portugal
To cite this article:
Costa, Rui, António C. Moreira, Jorge Mota, Adriana F. Chim-Miki. 2023. The Risk Structure of Portuguese Tourism Industry Subsectors: A PLS-SEM Approach, European Review of Business Economics, III(1): 65-83.
DOI: https://doi.org/10.26619/ERBE-2023.3.1.4
Received: 28 December 2023. Accepted: 17 February 2024. Published: 21 March 2024.
Language: English
Abstract
This paper examines risk factors that affect the Portuguese tourism industry subsectors, namely, travel agencies and tour operators, leisure and recreation activities, and tourism events firms. Additionally, it also assesses the effect of these risks on strategic and operational responses in the tourism subsectors mediated by a mitigation dimension. In terms of methodology, we used exploratory factor analysis (EFA) on data collected from 416 questionnaires distributed across the three tourism subsectors complemented by a Multigroup Analysis (MGA) via partial least squares structural equations modeling (PLS-SEM). The exploratory factor analysis confirmed distinct risk categories, including organizational, environmental, competitive, economic, political, infrastructure-related, circumstantial, business deficiencies, and specific (local) risks. Results documented the different risk impacts of risks on strategic and operational responses for tourism subsectors. While mitigation efforts do not significantly differ in their overall effects across subsectors, differences emerge in their direct effects. Concerning practical implications, this research provides insights for stakeholders in the tourism industry, supporting them with the knowledge to proactively understand, anticipate, and manage any risks in their operations, essential for boosting the resilience and competitive edge of the tourism subsectors in a global environment shrouded by uncertainty.
Keywords
Risk; Tourism Subsectors; SEM.
Abdelsalam, O., Aysan, A. F., Cepni, O., & Disli, M. (2023). The spillover effects of the COVID-19 pandemic: Which subsectors of tourism have been affected more? Tourism Economics, 29(2), 559-567. https://doi.org/10.1177/13548166211053670
Aliperti, G., Sandholz, S., Hagenlocher, M., Rizzi, F., Frey, M., & Garschagen, M. (2019). Tourism, crisis, disaster: An interdisciplinary approach. Annals of Tourism Research, 79, 102808. https://doi.org/10.1016/j.annals.2019.102808
Backer, E., & Ritchie, B. W. (2017). VFR travel: A viable market for tourism crisis and disaster recovery? International Journal of Tourism Research, 19(4), 400-411. https://doi.org/10.1002/jtr.2102
Bera, A., Drela, K., Malkowska, A., & Tokarz-Kocik, A. (2020). Mitigating risk of the tourism sector in the European Union member states during the COVID-19 pandemic. European Research Studies Journal, XXIII(4), 107–122.
Blake, A., & Sinclair, M. T. (2003). Tourism crisis management: US response to September 11. Annals of Tourism Research, 30(4), 813-832. https://doi.org/10.1016/S0160-7383(03)00056-2
Cushnahan, G. (2012). Crisis management in small-scale tourism. In Safety and Security in Tourism (pp. 325-340). Routledge.
Demiralay, S., & Kilincarslan, E. (2019). The impact of geopolitical risks on travel and leisure stocks. Tourism Management, 75, 460-476. https://doi.org/10.1016/j.tourman.2019.06.013
Franzoni, S., & Pelizzari, C. (2016). Weather risk management in tourism industry. Symphonya. Emerging Issues in Management(1), 45-55. https://doi.org/10.4468/2016.1.05franzoni.pelizzari
González Rodríguez, J. C., & Acevedo-Navas, C. (2021). Diagnóstico de riesgos en el sector turístico latinoamericano para el trienio 2020-2022. Revista Científica General José María Córdova, 19(34), 332-355.
Gössling, S., Scott, D., & Hall, C. M. (2020). Pandemics, tourism and global change: a rapid assessment of COVID-19. Journal of Sustainable Tourism, 29(1), 1-20. https://doi.org/10.1080/09669582.2020.1758708
Götz, O., Liehr-Gobbers, K., & Krafft, M. (2009). Evaluation of structural equation models using the partial least squares (PLS) approach. In V. Vinzi, W. Chin, J. Henseler, & H. Wang (Eds.), Handbook of partial least squares: Concepts, methods and applications (pp. 691-711). Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-540-32827-8_30
Hair, J., Hair Jr, J. F., Hult, G. T. M., Ringle, C. M., & Sarstedt, M. (2021). A primer on partial least squares structural equation modeling (PLS-SEM). Sage Publications.
Hamm, D., & Su, C.-H. J. (2021). Managing tourism safety and risk: Using the Delphi expert consensus method in developing the event tourism security self-beliefs scale. Journal of Hospitality and Tourism Management, 49, 364-374. https://doi.org/10.1016/j.jhtm.2021.10.001
Hystad, P. W., & Keller, P. C. (2008). Towards a destination tourism disaster management framework: Long-term lessons from a forest fire disaster. Tourism Management, 29(1), 151-162. https://doi.org/10.1016/j.tourman.2007.02.017
Kozak, M., Crotts, J. C., & Law, R. (2007). The impact of the perception of risk on international travellers. International Journal of Tourism Research, 9(4), 233-242. https://doi.org/10.1002/jtr.607
Lee, C. C., Olasehinde‐Williams, G., & Akadiri, S. S. (2021). Geopolitical risk and tourism: Evidence from dynamic heterogeneous panel models. International Journal of Tourism Research, 23(1), 26-38. https://doi.org/10.1002/jtr.2389
Lee, K.-H., & Hyun, S. S. (2015). A model of behavioral intentions to follow online travel advice based on social and emotional loneliness scales in the context of online travel communities: The moderating role of emotional expressivity. Tourism Management, 48, 426-438. https://doi.org/10.1016/j.tourman.2014.12.012
Lu, S., & Law, R. (2006). Technology crisis management in Mainland China: a study of hotels in Hangzhou. Information Technology in Hospitality, 4(4), 153-159. https://doi.org/10.3727/154595306779868449
Mawby, R. (2014). Crime and disorder, security and the tourism industry. In M. Gill (Ed.), The Handbook of Security (pp. 383-403). Palgrave Macmillan. https://doi.org/10.1007/978-1-349-67284-4_18
Mingqi, W. (2015). Analysis on Risk Management of the Small and Medium-sized Travel Agencies. 2015 Joint International Social Science, Education, Language, Management and Business Conference, Chongqing, China.
Mohanty, S., Nandha, M., Habis, E., & Juhabi, E. (2014). Oil price risk exposure: The case of the US travel and leisure industry. Energy Economics, 41, 117-124. https://doi.org/10.1016/j.eneco.2013.09.028
Nasr, N. E. S. (2017). Risk management in the light of travel agencies activity in Egypt. International Journal of Heritage, Tourism, and Hospitality, 10(2), 2.
Okumus, F., Altinay, M., & Arasli, H. (2005). The impact of Turkey’s economic crisis of February 2001 on the tourism industry in Northern Cyprus. Tourism Mmanagement, 26(1), 95-104. https://doi.org/10.1016/j.tourman.2003.08.013
Orchiston, C. (2013). Tourism business preparedness, resilience and disaster planning in a region of high seismic risk: The case of the Southern Alps, New Zealand. Current Issues in Tourism, 16(5), 477-494. https://doi.org/10.1080/13683500.2012.741115
Oroian, M., & Gheres, M. (2012). Developing a risk management model in travel agencies activity: An empirical analysis. Tourism Management, 33(6), 1598-1603. https://doi.org/10.1016/j.tourman.2011.12.020
Paraskevas, A., & Arendell, B. (2007). A strategic framework for terrorism prevention and mitigation in tourism destinations. Tourism Management, 28(6), 1560-1573. https://doi.org/10.1016/j.tourman.2007.02.012
Perl, Y., & Israeli, A. A. (2011). Crisis management in the travel agency sector: A case study. Journal of Vacation Marketing, 17(2), 115-125. https://doi.org/10.1177/1356766710392478
Pestana, M. H., & Gageiro, J. N. (2014). Análise de dados para ciências sociais: a complementaridade do SPSS (6 ed.). Edições Sílabo.
Pforr, C. (2009). Crisis management in tourism: A review of the emergent literature. In P. Hosie & C. Pforr (Eds.), Crisis management in the tourism industry: Beating the odds (pp. 37-52). Ashgate Publishing.
Ritchie, B. W. (2004). Chaos, crises and disasters: a strategic approach to crisis management in the tourism industry. Tourism Management, 25(6), 669-683. https://doi.org/10.1016/j.tourman.2003.09.004
Ritchie, B. W., & Jiang, Y. (2019). A review of research on tourism risk, crisis and disaster management: Launching the annals of tourism research curated collection on tourism risk, crisis and disaster management. Annals of Tourism Research, 79, 102812. https://doi.org/10.1016/j.annals.2019.102812
Ritchie, J. B., & Crouch, G. I. (2003). The competitive destination: A sustainable tourism perspective. Cabi.
Wang, J., & Ritchie, B. W. (2010). A theoretical model for strategic crisis planning: Factors influencing crisis planning in the hotel industry. International Journal of Tourism Policy, 3(4), 297-317. https://doi.org/10.1504/IJTP.2010.04039
Wang, J., & Ritchie, B. W. (2012). Understanding accommodation managers’ crisis planning intention: An application of the theory of planned behaviour. Tourism Management, 33(5), 1057-1067. https://doi.org/10.1016/j.tourman.2011.12.006
Wijaya, O. Y. A. (2021). Risk Management Mitigation in the New Normal Era. Budapest International Research and Critics Institute-Journal (BIRCI-Journal), 4(1), 1088-1097. https://doi.org/10.33258/BIRCI.V4I1.1716
Yang, E. C. L., & Nair, V. (2014). Tourism at risk: A review of risk and perceived risk in tourism. Asia-Pacific Journal of Innovation in Hospitality and Tourism (APJIHT), 3, 1-21. https://doi.org/10.7603/s40930-014-0013-z
Zenker, S., & Kock, F. (2020). The coronavirus pandemic – A critical discussion of a tourism research agenda. Tourism Management, 81, 104164. https://doi.org/10.1016/j.tourman.2020.104164
Zibanai, Z. (2014). Is the tourism industry a fragile heavy weight? Validation through a literature review of tourism system shocks. Journal of Tourism Management Research, 1(1), 1-13. https://doi.org/10.18488/journal.31/2014.1.1/31.1.1.13
