FACTORS INFLUENCING BUSINESS ENVIRONMENT WITHIN TRAVEL AND TOURISM COMPETITIVENESS

Abstract

Business environment is an essential indicator of a country's competitiveness in general, and in the tourism field in particular. The aim of this paper is to examine whether indicators of the Business Environment pillar of the Travel and Tourism Competitiveness Index (TTCI) share common factors. We use TTCI data of seven indicators obtained from World Economic Forum’s Executive Opinion Survey for 119 countries during 2017 and 2019. Factor analysis shows two common factors, namely General legislative conditions (protection of property rights, regulations on foreign direct investment, indicators of legal and judicial systems, and market dominance) and Taxation (specifically, its extent and effect on incentives to work and invest). Data of TTCI show that overall Switzerland, Singapore, Hong Kong, and Finland have the best business environment. Contrastingly, doing business is most difficult in Venezuela, Bolivia, and Mauritania. The specific findings are very similar for both analysed years. The results of this study could be useful in any attempts to manage the business environment in travel and tourism.