Advertising expenses and operational performance: Evidence from the global hotel industry

摘要

We investigate the impact of advertising on hotel management companies' (HMC) operational efficiencies on a sample of 90 international HMCs over the period 2010-2019. We employ time-dependent conditional frontier estimators to investigate the effect on HMCs' technological change and technological catch-up levels. Our findings support the existence of a non-monotonic convex relationship between HMCs' advertising expenses and their operational performance. Lastly, we also utilize the double bootstrap approach in a truncated regression setting to validate the overall effect of advertising expenses on HMCs' operational performance levels. The findings suggest that advertising expenses decrease operational inefficiencies. (C) 2020 Elsevier B.V. All rights reserved.