A Study on the Relative Efficiency of Regional Business Hotels - Focusing on the Busan and Jeju Areas -

This study analyzed the relative operational efficiency of 3-star hotels in Busan and Jeju that attracted the most tourists outside the Seoul metropolitan area in 2020 during the COVID-19 pandemic with the use of the input-oriented DEA models (CCR and BCC). For the analysis, the input variables were the number of hotel employees and the number of guest rooms, and the output variable was the hotel's revenue in 2020. In this study, the input variables were the number of guest rooms and the number of employees at each hotel, and the output variable was the hotel’s revenue. According to the analysis, among the 3-star hotels in the major tourist cities of Busan and Jeju, only Jeju Hotel E was found to be efficient under both the CCR and BCC models. Under the BCC model, three hotels, which are Busan Hotel D, Jeju Hotel B, and Jeju Hotel E, were found to operate efficiently. The RTS index, which represents the nature of scale returns, indicated that one hotel operated under constant returns to scale (CRS), one under decreasing returns to scale (DRS), and seven under increasing returns to scale (IRS).