An Examination of the Expenditure of the Top 20% of High-Spending Tourists: The Pareto Principle Revisited

Achieving sustained growth in tourism’s economic impact requires a detailed understanding of the factors that determine tourist expenditure. The Pareto principle suggests that 20% of customers account for 80% of total sales; however, whether this distributional rule applies to tourist expenditure remains uncertain. This study revisited the Pareto principle in the context of inbound tourism in Japan by analyzing large-scale micro-data from official surveys. The results revealed that the top 20% of high-spending tourists contribute roughly half of the total expenditure, which is significant, but not at the hypothesized 80% level. These findings underscore the partial concentration of spending within a relatively small subgroup, indicating that a strategic focus on high spenders remains vital. To further explore the determinants of this high-spending segment, this study employed unconditional quantile regression to identify key drivers such as tourists’ income, types of travel arrangements, and types of activities. This study contributes to the literature by refining our understanding of expenditure distribution in inbound tourism and offering actionable insights for policymakers and destination management organizations seeking to enhance tourist expenditure through targeted policies and marketing strategies.