Industry Structure, Segmentation, and Quality Competition in the U.S. Hotel Industry*

R. Andrew Butters, Thomas N. Hubbard*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review


We examine how quality competition affects the relationship between market size and industry structure at the product level using evidence from the U.S. hotel industry. Starting in the early 1980s, quality competition for business travelers became more based on variable and less on fixed costs, and became less scale intensive. Since then, market size increases have been met by more, but smaller, hotels in business travel destinations but continued to be met by larger hotels in personal travel destinations. Our results illustrate how the way consumers benefit from increases in market size depends on how firms compete.

Original languageEnglish (US)
Pages (from-to)491-537
Number of pages47
JournalJournal of Industrial Economics
Issue number2
StatePublished - Jun 2023

ASJC Scopus subject areas

  • Accounting
  • Business, Management and Accounting(all)
  • Economics and Econometrics


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