This paper examines the potential financial advantages and disadvantages of a project called Feudo Turistico, which proposes the establishment of a slow tourism destination between Rome and Fiuggi. The objective of the project is to reduce the concentration of tourist demand in the city centers of Rome and Fiuggi and instead distribute it across the Lazio region by providing a local cultural and active tourism experience with new services that are currently unavailable in the region. To assess the project’s feasibility, a cost-benefit analysis is conducted using Monte Carlo Simulation with 10,000 trials. This method allows for obtaining the net present value, internal rate of return, and discounted payback period for each simulated combination of input variables and then exploring the location and dispersion of these indicators. A simple random sampling technique is employed to simulate different sets of input parameters using a factor range between pessimistic and optimistic scenarios, where minimum and maximum values are determined based on existing literature, historical data in statistical reports of research institutions, and calculations derived from this data. Furthermore, two different settings are considered regarding the initial distribution of input parameters, and their outcomes are compared. The results and distribution of net present value, internal rate of return, and discounted payback period indicate that the Feudo Turistico project possesses a financially self-sufficient business model, generating cash flows that can repay the initial investment within a few years with a high probability.

Angelaccio, M., Hajiyeva, U. (2023). Slow Tourism Project to Redistribute Tourist Demand in Lazio: Cost-Benefit Analysis Using Monte Carlo Simulation. ATHENS JOURNAL OF TOURISM, 10(4), 243-258 [10.30958/ajt.10-4-1].

Slow Tourism Project to Redistribute Tourist Demand in Lazio: Cost-Benefit Analysis Using Monte Carlo Simulation

Angelaccio, Michele
Writing – Review & Editing
;
2023-12-01

Abstract

This paper examines the potential financial advantages and disadvantages of a project called Feudo Turistico, which proposes the establishment of a slow tourism destination between Rome and Fiuggi. The objective of the project is to reduce the concentration of tourist demand in the city centers of Rome and Fiuggi and instead distribute it across the Lazio region by providing a local cultural and active tourism experience with new services that are currently unavailable in the region. To assess the project’s feasibility, a cost-benefit analysis is conducted using Monte Carlo Simulation with 10,000 trials. This method allows for obtaining the net present value, internal rate of return, and discounted payback period for each simulated combination of input variables and then exploring the location and dispersion of these indicators. A simple random sampling technique is employed to simulate different sets of input parameters using a factor range between pessimistic and optimistic scenarios, where minimum and maximum values are determined based on existing literature, historical data in statistical reports of research institutions, and calculations derived from this data. Furthermore, two different settings are considered regarding the initial distribution of input parameters, and their outcomes are compared. The results and distribution of net present value, internal rate of return, and discounted payback period indicate that the Feudo Turistico project possesses a financially self-sufficient business model, generating cash flows that can repay the initial investment within a few years with a high probability.
dic-2023
Pubblicato
Rilevanza internazionale
Articolo
Esperti anonimi
Settore ING-INF/02
English
slow tourism, cost-benefit analysis, discounted cash flow, Monte Carlo Simulation
https://www.athensjournals.gr/tourism/2023-10-4-1-Angelaccio.pdf
Angelaccio, M., Hajiyeva, U. (2023). Slow Tourism Project to Redistribute Tourist Demand in Lazio: Cost-Benefit Analysis Using Monte Carlo Simulation. ATHENS JOURNAL OF TOURISM, 10(4), 243-258 [10.30958/ajt.10-4-1].
Angelaccio, M; Hajiyeva, U
Articolo su rivista
File in questo prodotto:
File Dimensione Formato  
2023-10-4-1-Angelaccio.pdf

solo utenti autorizzati

Tipologia: Versione Editoriale (PDF)
Licenza: Copyright dell'editore
Dimensione 513.48 kB
Formato Adobe PDF
513.48 kB Adobe PDF   Visualizza/Apri   Richiedi una copia

I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.

Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/2108/347665
Citazioni
  • ???jsp.display-item.citation.pmc??? ND
  • Scopus ND
  • ???jsp.display-item.citation.isi??? ND
social impact