Life Cycle of agrotouristic Firms in Sardinia

This paper analyses the supply of an important form of rural tourism, agrotourism, at a level of each of the four provinces on the island of Sardinia (Italy). Importantly, an analysis is undertaken on the impact that legislation has had on the life cycle. The analysis is framed into three main sections—firstly, the main legislative interventions introduced in Sardinia by the local government that were aimed at regulating the supply of agrotourism are presented; secondly, a life cycle description is given based upon a literature review and a methodology presented; thirdly, the life cycle analysis and legislative impacts are combined using an econometric approach in terms of trend factors of the Sardinian businesses over an extended period from 1986 to 2003. The analysis identifies that regional legislative actions have indeed had a significant impact in the evolution and dynamics of the supply of agrotourism on the island. The quantitative methodology identifies some heterogeneity in modelling the trend for each of the four Sardinian provinces, and evidence exists indicating that agrotourism is entering a stagnation stage. On the basis of the economic results obtained, suggestions are given to both the private sector and public policy makers in agrotourism.