TY - JOUR
T1 - Tourism Firms’ Vulnerability to Risk
T2 - The Role of Organizational Slack in Performance and Failure
AU - Zheng, Chen
AU - Li, Zezeng
AU - Wu, Snow
N1 - Publisher Copyright:
© The Author(s) 2021.
Copyright:
Copyright 2021 Elsevier B.V., All rights reserved.
PY - 2022/5/1
Y1 - 2022/5/1
N2 - This study explores the influence of political risk on firms in the tourism industry. It addresses a research gap regarding the impact of political risk on firm-level performance and failure and uncovers the role of organizational slack in this relationship. Firm-level political risk is estimated from 2002 to 2019 financial data for firms across six tourism sectors in a developed economy, the United States. Such risk is found to be significantly associated with firm performance and business failure. From the perspectives of the resource-based view and the threat-rigidity hypothesis, the results support the moderating effects of absorbed and unabsorbed slack on links between risk, performance, and business failure. Given that the COVID-19 pandemic has highlighted the tourism industry’s vulnerability, this study will be of interest to tourism firms seeking to improve business sustainability and resilience.
AB - This study explores the influence of political risk on firms in the tourism industry. It addresses a research gap regarding the impact of political risk on firm-level performance and failure and uncovers the role of organizational slack in this relationship. Firm-level political risk is estimated from 2002 to 2019 financial data for firms across six tourism sectors in a developed economy, the United States. Such risk is found to be significantly associated with firm performance and business failure. From the perspectives of the resource-based view and the threat-rigidity hypothesis, the results support the moderating effects of absorbed and unabsorbed slack on links between risk, performance, and business failure. Given that the COVID-19 pandemic has highlighted the tourism industry’s vulnerability, this study will be of interest to tourism firms seeking to improve business sustainability and resilience.
KW - Firm-level political risk
KW - Business failure
KW - Organizational slack
KW - Firm performance
KW - Tourism vulnerability
UR - http://www.scopus.com/inward/record.url?scp=85107186310&partnerID=8YFLogxK
U2 - 10.1177/00472875211014956
DO - 10.1177/00472875211014956
M3 - Article
VL - 61
SP - 990
EP - 1005
JO - Journal of Travel Research
JF - Journal of Travel Research
SN - 0047-2875
IS - 5
ER -
