11/23/2005

Holiday travel has huge impact on economy

As the Thanksgiving holiday draws near, the number of people traveling is up, and many industries within the field of transportation are having to accomodate the extra travelers. According to this holiday travel article, buses, trains, planes, and cars are all out in greater numbers. Despite higher flight prices, and increased traffic, those wanting to visit family and friends for Thanksgiving are still willing to fit the bill, and spend their time, in pursuit of being reunited with those they are close to. Because there is a boom in demand for transportation, be it driving, or flying, etc., some companies are able to raise their prices, while increasing demand, ultimately raising their revenues in the process. Also, while more customers, mean more potential variable costs, perhaps the large bulk of travelers enables some companies to ultimately save, and consolidate costs, shifting out revenues, and profits overall, in the long run. It is important to recognize that virtually all facets of life affect the economy, from visiting family for the holidays, to corporate stock changes, to politics, proving that all things influence the financial status of our country's, and global economy as a whole.

3 comments:

Connor said...

You really hit it on the head when you stated,"...virtually all facets of life affect the economy..." It is our daily actions that determine the prices of goods and services. Then when we take into consideration the typical consumer during the holiday season we see one who is more likely to spend the extra dollar to get the "perfect" gift. They do this without even realizing that millions of other consumers are doing the same thing. This behavior is exactly the reason why tons of investors buy various retail companies' stocks thus pushing the price of the stocks up! Yet does the average consumer notice this? No.

maddy said...

I know that recently my dollar has been added to the holiday travel list. Many students here in Cedar City travel multiple times a semester to the Salt Lake area. I however, becuase of gas prices have been reluctant to travel as often as previously and for Thanksgiving actually spent a little more to avoid the rush and flew to Salt Lake. It cut down on time and the money I've saved because of not traveling during the semester made it possible for me to save some time also. When it comes to the holidays travel is an important part of spending that takes place.

Dr. Tufte said...

There's a hidden message here: travel is a normal good (or even a luxury in some cases), so if traveling is up it means the economy is doing well too.