Will blockchain shake the paradigm of tourism?

Understand the Blockchain

Traditionally, when referring to information and communication technology, we are familiar with the concepts of the Internet of Things (IoT), robotics, contactless technology, and social media since these technologies are highly implemented in our everyday life.

Conversely, when blockchain is addressed on the table, we tend to avoid this concept due to its complex nature. Like a ghost cat, the concept of blockchain gradually infiltrates and blends into our life at an unnoticeable pace.

So, what is blockchain after all? Blockchain is a list of transactions or a record that is kept up by a network of clients (Sharma et al., 2021). To understand the blockchain in a simple way, a block is an entity to store the information, and each block is connected to its initial block while can build up new connections with new blocks, which enables all the blocks linked together within the same data structural system (Sharma et al., 2021).

Also, what can we do with blockchain? Several applications such as smart contract, tokenization, inter-organizational data management, governmental digital system construct, healthcare system, and financial service have been proposed, implemented for revolutionizing our society (Sharma et al., 2021).

Understand the Paradigm of Tourism

It is without a doubt that new technologies are required to be implemented in tourism, could blockchain become the next tipping point in the tourism industry?

Before answering this question, it is necessary to review the current paradigm of the tourism industry from a broader perspective and investigate whether blockchain technology is an appropriate fit for certain stances.

What is a paradigm? This question bothers me as I had encountered this term quite often. From the explanation of the Oxford English Dictionary, ‘a typical example or pattern of something; a pattern or model’. In the book “The Structure of Scientific Revolutions”, Thomas Kuhn (1962) introduced the phenomenon of a paradigm shift, which to me is a better way to understand the paradigm.

In my understanding, a paradigm shift occurs where new disciplines, conceptual models, and theoretical frameworks could not fit into the existing body that encompasses all knowledge and theories, which requires a shift to a new body. In another word, the paradigm is the body that includes all relevant knowledge and theories that fits into its system.

Now we understand the term “paradigm”, but what’s the paradigm of the tourism industry? To see the bigger picture, Tribe et al. (2015) raised three critical questions: “How is the tourism knowledge system constructed?”; “What are the dynamics of change in the tourism knowledge system”, and “Paradigms, global structure, and processes”.

By reflecting on his own article “The Indiscipline of Tourism” (Tribe, 1997), Tribe concluded that tourism exists in the emerging fields of traditional academy knowledge and knowledge that is yet set within a disciplinary framework. In a broad sense, tourism till today can be considered a field of study instead of a discipline, which answers the first question.

As we understand the position of tourism as a field of study, two approaches cover the field of business of tourism (Fletcher, Fyall, Gilbert, & Wanhill, 2017) including:

• Tourism Demand
• The Tourism Destination
• The Tourism Sector
• Marketing for Tourism

and social science (Hannam & Knox, 2010).

• Regulating Tourism
• Commodifying Tourism
• Embodying Tourism
• Performing Tourism
• Tourism and the Everyday
• Tourism and the Other
• Tourism and the Environment
• Tourism and the Past

Tribe et al. (2015) pinpointed that ideology and discourse aspects should be added as an addition to complement Kuhn’s explanation of “paradigm”, while from the perspective of neoliberalism, the core concepts address:

• Competitiveness
• Deregulation
• Efficiency
• Free Markets
• Profit
• Consumerism
• Capitalism
• Globalization
• Individualism
• Growth

However, neoliberalism cannot stand for the ultimate universal worldview. Hence, Tribe et al. (2015) addressed the other values:

• Inclusivity
• Equity
• Equality
• Beauty
• Sustainability

Furthermore, Tribe et al, (2015) reflected on the consequences that tourism is mainly driven by the forces of the neoliberal’s values and ideology, while tourism research in a sense amplifies and re-visits these core concepts, which deepen the imbalance of tourism development as “tourism paradoxes”.

Discussion of the Practicality of Blockchain in the Tourism Industry

Since we understand the paradigm of the tourism industry, its evolving development, and its deeper values, it is time to put our attention back to the blockchain once again.

Kizildag et al. (2015) argued that blockchain could result in a paradigm shift, though blockchain technology is still at the “early adopter” stage. Two theories are suggested to implement blockchain technology including the diffusion of the innovation theory, and the agency theory.

The diffusion of the innovation theory indicates that hospitality and tourism companies are distant from blockchain technology unless the concept of value co-creation is recognized by those companies as indicated.

The agency theory on the other hand emphasizes the forthcoming contradictions that can be caused by the distinctive interests of the principals and the agencies. As the agents and the principals have different interests (Jesnsen and Meckling, 1976), the inconsistency of the operation and management may result in miscommunication (Altin et al., 2016).

Studies of the agency theory implied that blockchain could resolve the pain points of institutionalized communication, such as information asymmetry, trust issues, transaction transparency, and security issue (Altin et al., 2016). Additionally, Kizildag et al. (2015) highlighted the decentralized feature and the transparent environment of blockchain technology.

Accordingly, three research propositions were presented to further the practicality of blockchain in the tourism industry (Önder & Treiblmaier, 2018):

• Research proposition 1: New forms of evaluations and review technologies will lead to trustworthy rating systems.

• Research proposition 2: The widespread adoption of cryptocurrencies will lead to new types of C2C markets.

• Research proposition 3: Blockchain technology will lead to increased disintermediation in the tourism industry.

Proposition 1 addressed that the user identities do not need to be revealed since all online reviews will go through an end-to-end private system so that nobody can duplicate their reviews to manipulate the rating system (Önder & Treiblmaier, 2018).

Proposition 2 discussed that business can be doable without the unnecessity of trustworthy intermediaries, while the adoption of cryptocurrencies can trigger the formation of new C2C business markets (Önder & Treiblmaier, 2018).

Proposition 3 implied that the increasing disintermediation effect caused by blockchain technology (Colombo & Baggio, 2017) has the potential to eliminate new intermediaries (Ford, Wang, & Vestal, 2012), which is good for the smaller business to remove the entry barriers (Önder & Treiblmaier, 2018).

Similarly, Tyan et al, (2021) emphasize the positive impacts of the application of blockchain in sustainable tourism based on the Sustainable Development Goals (SDG) of the UN. Other than the disintermediation, review system as we discussed, four more extensive applications were addressed as:
• Food supply chain management and food waste mitigation
• Service customization and tourists’ satisfaction
• Awareness rise
• Tourists’ sustainable behavior

In comparison to the previous research, identical implementations are revisited, and that is how I realize that the research of blockchain technology used in tourism has come to a saturated state. Looking back to the question: will blockchain shake the paradigm of tourism, here are the final wrap-ups and the takeaways of my thinking.

Connected floating cubes background

Will Blockchain Shake the Paradigm of Tourism?

To enable the paradigm shift, it requires the disruptive innovation of technology, while large amounts of research, hypothesis-building, and theory-construction are necessary. From a development perspective, we observe tourism being questioned as indiscipline to an extent, while we also notice that tourism extends its reach from business and social science to other disciplines.

It is very difficult to deconstruct the previous built and long-lasting theories and knowledge, meaning that the process of shaking the well-built paradigm is a long journey. But it is common when new things are introduced and threaten the existence of the current paradigm, which occurs in the case of blockchain technology as well.

In a sense, the inevitable appearance of blockchain indeed commences the process of research, but to what extent that blockchain reaches a state of having the absolute influential power to trigger further and deeper research is yet to be uncovered. Without a doubt, scholars and researchers had invested their efforts to investigate the positioning of blockchain in the tourism industry, while it appears that a bottleneck is reached as identical conclusions are drawn.

To recap this article, we are aware of blockchain technology, but seldom actually understand what it is and how to use it. It occurs to me that the increasing attention to blockchain technology has aroused many researchers, and that many of them have established the relevance of blockchain and tourism is solid proof that the blockchain is shaking the paradigm of tourism. However, to what extent that blockchain affects the development of the tourism paradigm requires a tremendous of cooperative work among researchers who share the similar field of studies.

1. Altin, M., Kizildag, M., & Ozdemir, O. (2016). Corporate Governance, Ownership Structure, and Credit Ratings of Hospitality Firms. The Journal of Hospitality Financial Management, 24(1), 5–19. https://doi.org/10.1080/10913211.2016.1166022
2. Colombo, E., & Baggio, R. (2017). Tourism Distribution Channels: Knowledge Requirements. In N. Scott, M. De Martino, & M. Van Niekerk (Eds.), Bridging Tourism Theory and Practice (Vol. 8, pp. 289–301). Emerald Publishing Limited. https://doi.org/10.1108/S2042-144320170000008016
3. Fletcher, J., Fyall, A., Gilbert, D., & Wanhill, S. (2017). Tourism: Principles and Practice. Pearson UK.
4. Ford, R. C., Wang, Y., & Vestal, A. (2012). Power asymmetries in tourism distribution networks. Annals of Tourism Research, 39(2), 755–779. https://doi.org/10.1016/j.annals.2011.10.001
5. Giannopoulos, Antonios, Skourtis, George, Kalliga, Alexandra, Dontas-Chrysis, Dimitrios-Michail, & Paschalidis, Dimitrios. (2020). Co-creating high-value hospitality services in the tourism ecosystem: Towards a paradigm shift? https://doi.org/10.5281/ZENODO.3822065
6. Hannam, K., & Knox, D. (2010). Understanding Tourism: A Critical Introduction. SAGE.
7. Jensen, M. C., & Meckling, W. H. (1976). Theory of the firm: Managerial behavior, agency costs and ownership structure. Journal of Financial Economics, 3(4), 305–360. https://doi.org/10.1016/0304-405X(76)90026-X
8. Kizildag, M., Dogru, T., Zhang, T. (Christina), Mody, M. A., Altin, M., Ozturk, A. B., & Ozdemir, O. (2019). Blockchain: A paradigm shift in business practices. International Journal of Contemporary Hospitality Management, 32(3), 953–975. https://doi.org/10.1108/IJCHM-12-2018-0958
9. Kuhn, T. (2021). The Structure of Scientific Revolutions. In Philosophy after Darwin: Classic and Contemporary Readings (pp. 176–177). Princeton University Press. https://doi.org/10.1515/9781400831296-024
10. Önder, I., & Treiblmaier, H. (2018). Blockchain and tourism: Three research propositions. Annals of Tourism Research, 72, 180–182. https://doi.org/10.1016/j.annals.2018.03.005
11. Sharma, N., Shamkuwar, M., Kumaresh, S., Singh, I., & Goje, A. (2021). Chapter 10—Introduction to blockchain and distributed systems—Fundamental theories and concepts. In S. Krishnan, V. E. Balas, E. G. Julie, Y. H. Robinson, & R. Kumar (Eds.), Blockchain for Smart Cities (pp. 183–210). Elsevier. https://doi.org/10.1016/B978-0-12-824446-3.00002-8
12. Tribe, J., Dann, G., & Jamal, T. (2015). Paradigms in tourism research: A trialogue. Tourism Recreation Research, 40(1), 28–47. https://doi.org/10.1080/02508281.2015.1008856
13. Tyan, I., Yagüe, M. I., & Guevara-Plaza, A. (2021). Blockchain Technology’s Potential for Sustainable Tourism. In W. Wörndl, C. Koo, & J. L. Stienmetz (Eds.), Information and Communication Technologies in Tourism 2021 (pp. 17–29). Springer International Publishing. https://doi.org/10.1007/978-3-030-65785-7_2