Diversification of the Rural Economy by Rural Tourism

In this paper the author presents a conceptual model applying the comparative advantage theory to rural tourism as a niche market, and clarifies the significance of rural tourism in diversifying the rural economy. This model shows that less-favored areas can obtain comparative advantages in regard to a niche market, against favored areas. These results underline the perspective that the theory of comparative advantage can be an effective conceptual background for the diversification of the rural economy by rural tourism especially in less-favored areas. The author also examines demand for rural tourism, outlining the characteristics of visitors of pick-your-own farms, and clarifies that they tend to have higher academic background, higher status, be outdoor oriented with moderate budgets and actively seek out travel information, but at the same time they are more severe concerning the quality of services they receive. These characteristics indicate that rural tourism is up-market, a result consistent with other proceeding studies. Thus, providing information through various channels from the rural side is considered effective in attracting these people on the one hand, and improving the quality of service is necessary to develop loyalty and to stay competitive with other rural areas on the other hand.