Troxler, Pascal; Bandi Tanner, Monika; Roller, Marcus (December 2023). The Investment Competition among Swiss Ski Areas (CRED Research Paper 45). Bern: CRED - Center for Regional Economic Development
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In recent years, ski area operators in Switzerland have faced a decreasing demand due to climate change, exchange rate pressure and demographical changes among other factors. At the same time, ski lift and snowmaking capabilities have increased – partly with financial aid from public funds. It is therefore crucial to find out how much ski area investments retain demand and affect the competition for the remaining guests. We link firm-level data from ski areas to natural snowpack data and use Two-Way Fixed Effect (TWFE) estimators to study (i) how ski areas lower their dependency on natural snow by investing in snowmaking facilities, (ii) the effect of ski lift investments on skiing demand and revenue and (iii) the impact of lift investments on the spatial competition between neighboring ski areas. We find that ski areas with above-median snowmaking capabilities lower their dependency on natural snow by two-thirds. Ski lift investments induce a one-time positive average effect of 4.1% on demand and 1.9% on revenue in the winter following the construction. Finally, we document negative effects of ski lift expansions of neighboring areas within a road distance of up to 50 kilometers on demand.
Item Type: |
Working Paper |
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Division/Institute: |
03 Faculty of Business, Economics and Social Sciences > Department of Economics > Institute of Economics > Economic Policy and Regional Economics 03 Faculty of Business, Economics and Social Sciences > Department of Economics > Institute of Economics 11 Centers of Competence > Center for Regional Economic Development (CRED) |
UniBE Contributor: |
Troxler, Pascal Simon, Bandi, Monika, Roller, Marcus |
Subjects: |
300 Social sciences, sociology & anthropology > 330 Economics |
Series: |
CRED Research Paper |
Publisher: |
CRED - Center for Regional Economic Development |
Language: |
English |
Submitter: |
Melanie Moser |
Date Deposited: |
30 May 2024 16:24 |
Last Modified: |
31 May 2024 04:14 |
JEL Classification: |
L83, L88, R41, Z32 |
BORIS DOI: |
10.48350/197403 |
URI: |
https://boris.unibe.ch/id/eprint/197403 |
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