Forecasting of Iran tourism flow using the Improved Gray Model, GM (1, 1)

The global tourism industry, which has invested in many countries for its profits, can be a substitute for countries exporting raw materials. This industry can have various developmental effects, such as currency earnings, re-distribution of income, job creation and economic prosperity and since it is closely related to other industries such as hoteliers, transportation, travel agencies, craftsmen, and restaurateurs. Today tourism is considered as one of the most important components and development indicators, as most countries make special investments in this sector. Due to its historical and natural status, Iran has a good basis for foreign tourism expansion. Issues that will help government officials and planners to maximize their productivity and profitability from foreign tourism is predicting tourist demand for years to come. In this regard, this paper, using the improved Gray Model GM (1, 1), seeks to provide a good prediction of the future tourist demand for Iran. The privileged feature of the GM's (1, 1) improved gray model is that it can be predicted with a very low number of data and in addition has a very low error. The results of the research show that tourism demand is increasing and by 2022 the demand for foreign tourism will reach 17.5 million per year. Also, comparing the results of GM (1, 1) model with ARIMA method indicates a lower error of GM (1, 1) model in predicting the number of foreign tourists. Considering the importance of predicting the tourism demand in planning and the characteristics of the GM model (1, 1) it will be useful, carrying out separate researches on the demand of foreign tourists from different countries. Since tourists in different regions have different cultures and desires, separate studies can be useful in more accurate planning.