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    Rights statement: The final, definitive version of this article has been published in the Journal, Journal of Travel Research, 55 (6), 2016, © SAGE Publications Ltd, 2016 by SAGE Publications Ltd at the Journal of Travel Research page: http://jtr.sagepub.com/ on SAGE Journals Online: http://online.sagepub.com/

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Unobserved heterogeneity in hospitality and tourism research

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<mark>Journal publication date</mark>07/2016
<mark>Journal</mark>Journal of Travel Research
Issue number6
Volume55
Number of pages15
Pages (from-to)774-788
Publication StatusPublished
Early online date12/06/15
<mark>Original language</mark>English

Abstract

Despite the growing complexity of structural equation model (SEM) applications in tourism, it is surprising that most applications have estimated these models without accounting for unobserved heterogeneity. In this article, we aim to discuss the concept of unobserved heterogeneity in more detail, highlighting its serious threats to the validity and reliability of SEMs. We describe a Bayesian finite mixture modeling framework for estimating SEMs while accounting for unobserved heterogeneity. We provide a comprehensive description of this model, and provide guidance on its estimation using the WinBUGS software. We illustrate the importance of unobserved heterogeneity and the finite mixture modeling framework using a didactic application on brand equity where heterogeneity is likely to play an important role because of the differences in how consumers perceive the different dimensions of brand equity. We compare between various models and illustrate the differences between the standard and heterogeneous SEM and discuss the implications for research and practice.