Model Perspective

Apr 15, 2026 · Industry Insights

Why Are Chinese Hotels Closing? A Budget‑Constraint Analysis of Shifting Consumer Demand

The article applies a classic budget‑constraint model to China's 2025 hotel market, revealing how slowed income growth, cheaper travel alternatives, and lifestyle changes force consumers to downgrade or skip overnight stays, concentrating demand in low‑price segments and threatening mid‑range hotels.