Start Date
7-1-2011 4:00 PM
End Date
7-1-2011 5:15 PM
Track
1. Track 1 – Formal Paper Presentation
Subject Area
Consumer Behavior
Faculty Member
Barry Mak hmbarry@polyu.edu.hk
Abstract
This study is concerned with a type of tour package businesses referring to as “zero-fare” group tours. The terminology of “zero-fare” group tours was coined exclusively in the Chinese context and has been widely used in the industry to describe a relationship of sharing tour fares between wholesale travel agents (WTAs) and inbound tour operators (ITOs), indicating that the former, in principle, transfers no tour fares downward to the latter for service arrangements. The fundamental proposition in this study is that the problem of “zero-fare” group tours is quality deterioration which is arguably the consequence of information asymmetries. This proposition can be justified by referring to three prominent features of services and package tours in particular, namely intangibility, heterogeneity, and inseparability of production and consumption, which have been extensively researched but not yet in relation to information asymmetry. Evidence is presented for a preliminary validation of this proposition and the associated hypotheses.
Keywords
information asymmetry, reputation, “zero-fare” group tours, China
Information Asymmetries on Quality: The Case of Chinese Package Tourists
This study is concerned with a type of tour package businesses referring to as “zero-fare” group tours. The terminology of “zero-fare” group tours was coined exclusively in the Chinese context and has been widely used in the industry to describe a relationship of sharing tour fares between wholesale travel agents (WTAs) and inbound tour operators (ITOs), indicating that the former, in principle, transfers no tour fares downward to the latter for service arrangements. The fundamental proposition in this study is that the problem of “zero-fare” group tours is quality deterioration which is arguably the consequence of information asymmetries. This proposition can be justified by referring to three prominent features of services and package tours in particular, namely intangibility, heterogeneity, and inseparability of production and consumption, which have been extensively researched but not yet in relation to information asymmetry. Evidence is presented for a preliminary validation of this proposition and the associated hypotheses.