A Hedonic Analysis of 5-Star Hotel Prices on Booking.com: Evidence from Italy

In the modern hospitality sector, dynamic pricing has become a critical tool for revenue management, especially within the highly transparent digital marketplace of Online Travel Agencies (OTAs). This thesis investigates the determinants of online room prices within the Italian 5-star hotel segment, aiming to quantify the relative importance of tangible, intangible, and contextual factors. The research employs an augmented hedonic pricing framework. A large panel dataset, comprising 286,503 offer-level observations from 646 unique luxury hotels, was collected from Booking.com during the 2025 peak season. The primary analysis uses a fixed-effects (FE) panel model to control for unobserved hotel heterogeneity, complemented by a pooled OLS model. Findings reveal a dual-level pricing structure. Strategic, between-hotel price positioning is determined by locational factors, long-term reputation, and key fixed amenities. Tactical, within-hotel price variation is driven by verifiable tangible attributes (like room size) over marketing labels, and by the unbundling of contextual factors like breakfast and refundability. These tactical strategies are also found to vary significantly by destination type. This work provides a clear, data-driven framework distinguishing between the strategic and tactical drivers of value in the luxury hotel market.