Guang-Xin Gao et al. studies the optimal Stackelberg decisions and strategic interactions of a hotel and a customer in online booking through OTA with customer-centric payment service. The research has recently been published in Annals of Tourism Research (rated 4 in the ABS ranking), a top journal in the field of tourism management. That is a social sciences journal focusing upon the academic perspectives of tourism.

The abstract of the paper is copied below.

Facing stiff competition, online travel agencies (OTAs) are dedicating to provide customer-centric payment service in hotel online booking, which poses challenges for hotels and customers to make optimal strategies. This paper studies the optimal Stackelberg decisions and strategic interactions of a hotel and a customer in online booking through OTA with customer-centric payment service. The results show that refund rate has great effect on the customer’s payment decision, while transaction cost has great influence on the hotel’s operational decision. When the refund rate is greater than a threshold, the customer prefers online payment. Being a leader in the Stackelberg game, the hotel can induce customers to choose the payment option with the lowest transaction cost by setting a refund rate.

If you are interested in the research, please read the paper

Guang-Xin Gao, Jian-Wu Bi. Hotel booking through online travel agency: Optimal Stackelberg strategies under customer-centric payment service [J]. Annals of Tourism Research, 2021, 86.

A full version of this article could be viewed at: https://doi.org/10.1016/j.annals.2020.103074.