A study of hotel sector efficiency in the Canary Islands

Resumen

This research focuses on the analysis of the efficiency of hotel supply in the Canary Islands. To do this, data on tourist accommodation from an exhaustive official survey of the hotel sector are used for the years 2010 and 2015. A production frontier is calculated by means of Data Envelopment Analysis (DEA), both from a single-product and multi-product perspective. This allows an estimation of the technical and scale efficiencies in the Canary Island hotel sector and technical efficiency scores for each hotel. Also, a simple descriptive analysis of explanatory variables of inefficiency is carried out: size, quality and location. Results suggest that there is certainly room for improvement hotels located in the Canary Islands in terms of technical efficiency. The smallest and the largest hotels achieve the highest levels of technical efficiency, highest stars hotels obtain the lowest levels of efficiency and hotels located in tourist municipalities present higher technical efficiency than those situated in the islands’ capitals.