Do cultural tourism firms perform better than their rivals?

Previous studies assume that cultural tourism attract higher socioeconomic groups with higher cultural capital. Accordingly, most cultural tourists are regarded and described as ‘‘up-scaled’’ (mature aged with high education and high income earnings). Bearing this in mind, it might be expected that firms operating in cultural tourism activities earn higher profits and perform better than other kinds of tourism activities. Since there are differences in firm performance, within countries, that are not captured by national aggregates, this paper performs a financial analysis of cultural tourism firms operating in Northern Portugal in 2002-2017 and compares their financial performance with other kinds of tourism firms. Firm level data are collected from the National Tourism Registry and SABI databases. Firms operating in more than one tourism typology were withdrawn. From the registered 732 firms, 74% operate exclusively in cultural tourism, 17% in nautical tourism and 9% operate in nature/adventure tourism. A set of indicators of profitability and financial structure and leverage are applied to a sample of 386 firms. Results show that firms operating in cultural tourism activities have higher average profits, make a more efficient usage of investors’ funds and display a better liquidity position, though the analysis across business cycles appear to indicate that these firms are more vulnerable to periods of crisis and expansion than the remaining tourism firms. Also, the analysis for larger firms shows that cultural tourism firms display better financial structures.