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Assessment of the Effect of Sustainability Practices on Financial Leakage in the Hotel Industry in Jordan Nidal Alzboun Clemson University, [email protected]

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Assessment of the Effect of Sustainability Practices on Financial Leakage in the Hotel Industry in Jordan Nidal Alzboun Clemson University, Nalzbou@G.Clemson.Edu Clemson University TigerPrints All Dissertations Dissertations 12-2014 Assessment of the effect of sustainability practices on financial leakage in the hotel industry in Jordan Nidal Alzboun Clemson University, [email protected] Follow this and additional works at: https://tigerprints.clemson.edu/all_dissertations Part of the Recreation, Parks and Tourism Administration Commons Recommended Citation Alzboun, Nidal, "Assessment of the effect of sustainability practices on financial leakage in the hotel industry in Jordan" (2014). All Dissertations. 1425. https://tigerprints.clemson.edu/all_dissertations/1425 This Dissertation is brought to you for free and open access by the Dissertations at TigerPrints. It has been accepted for inclusion in All Dissertations by an authorized administrator of TigerPrints. For more information, please contact [email protected]. ASSESSMENT OF THE EFFECT OF SUSTAINABILITY PRACTICES ON FINANCIAL LEAKAGE IN THE HOTEL INDUSTRY IN JORDAN A Dissertation Presented to the Graduate School of Clemson University In Partial Fulfillment of the Requirements for the Degree Doctor of Philosophy Parks, Recreation and Tourism Management By Nidal M. Al Zboun December 2014 Accepted by: Dr. Kenneth F. Backman, Committee Chair Dr. Sheila Backman Dr. William Norman Dr. DeWanye Moore ABSTRACT Tourism revenues are not an accurate indication of the financial impact of this industry because in some cases a proportion of the profits leaves the host country for various reasons, resulting in what is referred to as leakage. The research reported here investigates this issue in connection with the sustainability practices of hotels in Jordan, one of the strategies firms and governments can adopt to enhance performance and to address problems related to environmental, community, and economic development adding a novel contribution to the tourism literature. A mixed method approach was used to collect and analyze the data obtained from 18 semi-structured interviews conducted with randomly selected hotel managers to obtain an enhanced understanding of the financial leakage in Jordanian hotels. In addition, a self-administered survey was distributed to hotel managers in all 213 classified hotels in Amman, Aqaba, Petra, and the Dead Sea area. Of these, 163 questionnaires were returned for a response rate of 76.5%. A coding technique was used to analyze the qualitative data while frequency analysis, Confirmatory Factor Analysis CFA, and Structural Equation Modeling SEM were used to test research hypotheses. The results of the qualitative and quantitative analyses complemented each other. The qualitative results revealed that Jordanian hotel managers have a high level of awareness regarding the financial leakage issue because they could explain its main channels, the primary reasons for it, and potential ways for mitigating it. Furthermore, the results indicated that sustainability practices have a positive effect on financial leakage. Specifically, it was found that high class and chain hotels have more sustainability ii practices and higher financial leakage than low class and independent hotels, results supported by past research. However, the educational level of hotel managers did not have a significant effect on either issue. The results from this study help hotels develop financial and conservation strategies benefitting their local economies, resources, and cultures. They may also enhance our understanding of the importance of community involvement in tourism. Future research could include a longitudinal study exploring the evolution of sustainability in the hotel sector. In addition, it could be extended to such tourism businesses as restaurants and souvenir shops. iii DEDICATION This dissertation is dedicated to my loving parents for their endless love, support, and prayers, to my beautiful wife for being supportive, loving, and patient during this journey, to my lovely kids Mohammed and Bana, to my brother Ali and my sisters. I am grateful to have you all in my life. iv ACKNOWLEDGMENTS I would first like to express my deepest gratitude to my committee chair, Dr. Kenneth Backman, who has given me a high self-confidence when he told me at the beginning of this research that you are the leader pushing me to be an independent researcher. From the bottom of my heart, thank you Dr. Ken for your guidance, patience, understanding, and support during my time at Clemson University. To Dr. Sheila Backman, you‟ve taught me the insistence to achieve my goal, how to think out of the box and how to tie every article, information, or idea to my research. To Dr. William Norman, who has a special school in thinking and teaching, I did the best to meet his high standards. Thank you for serving on my committee giving me your valuable comments. Special thanks goes to Dr. Dewayne Moore, who has provided me his precious time helping me throughout the process of statistical analysis that he taught me how to be more precise and organize. Thank you all for your generous assistance, valuable feedback, and contributions. v TABLE OF CONTENTS Page TITLE PAGE .................................................................................................................... i ABSTRACT ..................................................................................................................... ii DEDICATION ................................................................................................................ iv ACKNOWLEDGMENTS ............................................................................................... v LIST OF TABLES ........................................................................................................ viii LIST OF FIGURES ......................................................................................................... x LIST OF MAPS .............................................................................................................. xi CHAPTER I. INTRODUCTION ......................................................................................... 1 Background of the study .......................................................................... 1 Theoretical background ........................................................................... 7 Tourism in Jordan .................................................................................. 10 Statement of the problem ....................................................................... 13 The purpose and research questions ...................................................... 15 Hypotheses ............................................................................................. 16 Relevance of the study ........................................................................... 21 Structure of the dissertation ................................................................... 22 Definitions of terms ............................................................................... 23 II. LITERATURE REVIEW ............................................................................ 24 Financial leakage in tourism .................................................................. 24 Financial leakage in the hotel industry .................................................. 29 Sustainable tourism development .......................................................... 31 Sustainability in the hotel industry ........................................................ 35 Triple bottom line .................................................................................. 39 The hotel industry in Jordan .................................................................. 42 Benefits of adopting sustainability practices in hotels ........................... 45 vi Table of Contents (Continued) Page III. METHODOLOGY ...................................................................................... 47 Research strategy ................................................................................... 47 Study area............................................................................................... 48 Target population .................................................................................. 50 The instrument ...................................................................................... 51 Data collection ....................................................................................... 53 Data analysis .......................................................................................... 57 Validity and reliability ........................................................................... 66 IV. RESULTS .................................................................................................... 68 Qualitative results .................................................................................. 68 Quantitative results ................................................................................ 77 Descriptive statistics ........................................................................ 77 Confirmatory factor analysis............................................................ 89 Measurement model ......................................................................... 90 Structural model ............................................................................... 98 V. DISCUSSION AND CONCLUSION ....................................................... 111 Discussion ............................................................................................ 111
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