129-244 Tourism 2016 02EN.indd

Th e research about the determinants of fi rms' performance has been a crucial question for managers, researchers and stockholders. Th e main objective of this exploratory paper is to study the economic drivers of revenue per available room (RevPAR) in the Portuguese hotels. Th is study examines the local and global factors driving RevPAR in diff erent hotel segments, calculating how much of the overall changes in RevPAR are explained by national factors and how much by broader factors. Using seemingly unrelated regression analysis and considering monthly data from 2011 to 2015, the results indicate that local variables are more important than the global ones, with that diff erence more striking for the 4 star hotels. In aggregate terms, local factors account for 55% of the changes in Portuguese hotels RevPAR. Th e US consumer sentiment index is never signifi cant and the EU and Portugal consumer confi dence indexes do not seem to be important drivers of RevPAR for the diff erent categories of hotels. Th e results show that the hotel sector performance is closely related to cyclical factors, especially to tourism growth. Although in recent years Portugal has enjoyed a strong surge in the number of tourists, in part motivated by external factors, the results demonstrate the high vulnerability of the sector to those volatile and out of our infl uence variables, highlighting the danger of some reversion in the medium term.