Environmental Quality and Entrepreneurial Activity in Rural Tourism in Italy

Abstract

We estimate the relation between environmental quality and services in rural tourism in Italy. We use the average number of firms per region in 2003-07 to indicate entrepreneurial activity. We suggest that heterogeneity among administrative regions can be tied to environmental quality. Incorporated farms in rural tourism are relatively more common in regions with better environmental quality, and command higher average price from better quality in hospitality. Only 7% of entrepreneurial activity can be attributable to environmental quality. We conclude that rural tourism activity in Italy is not genuinely tied to environmental quality.