Play or not to play-An analysis of the mechanism of the zero-commission Chinese outbound tours through a game theory approach

The purpose of this study is to demystify the mechanism of the so-called zero-commission tours that have become synonymous with the booming Chinese outbound tourism market in the past decade. Two models of game theory are applied to identify nine proposed key factors that constitute the "zero-tour" phenomenon. These involve interactions in both the temporal and spatial dimensions of all of the stakeholders concerned with such tours, from outbound tourists and outbound and inbound operators to local guides and governments both within and beyond the Chinese border. It is concluded that zero-commission tours, underpinned by the proposed factors and notwithstanding their current legal and practical viability, have a tremendous negative impact on all of the stakeholders. This study may serve as a reference for the drafting and implementation of both policy and business countermeasures to curb zero-commission tours, thus facilitating more positive contributions from Chinese outbound tourism to the development of world tourism.