A production function approach to productivity analysis in services : the case of tourism activities in selected Caribbean countries

• Main Author: Charles, Sylvia M.
• Published: University of Surrey 1997
• Subjects: 330; Services sector
• Online Access: http://ethos.bl.uk/OrderDetails.do?uin=uk.bl.ethos.388889

The study begins with a conceptual framework, which defines services, examines theories on the role of services within economies and looks at the concept of services sector productivity. It then discusses measurement issues as they relate to services in general and more specifically to tourism activities. The study then presents an empirical analysis of Caribbean services sectors, in order to indicate their growing importance in the economies of the English-speaking Caribbean countries. It examines the relative contributions of the components of the services sector, investigates the income elasticity thesis and suggests criteria for identifying service economies. As a background for the production function analyses, the dissertation presents synopses of the three tourism sub-sectors being studied (accommodation, restaurant and transport and allied activities). These descriptions are based on data compiled from a survey undertaken in three countries. The dissertation's main area of focus is on the use of the production function approach to the study of productivity in tourism activities. Using a model based on the Cobb-Douglas and modified production functions, it estimates the partial elasticities of output with respect to individual inputs. The findings indicate that the labour variable exerts a relatively strong influence on output, while the capital variable exhibits little or no impact on the latter. Based on these findings and an examination of the productivity ratio, the study concludes with a discussion of factors influencing productivity.