Before discussing productivity in services, I need to dispel the myth that we can grow tourism and international business by lowering our prices. Barbados commands a tiny share of Caribbean tourism, less than 5 percent, and a miniscule percentage of global tourism to tropical resorts.
So long as our prices are right we can sell to our full capacity; if our prices are too high we’re out of the market altogether; and if our prices are too low we are offering our customers a bargain at our expense, unnecessarily. If our prices are right, why do we sometimes fall below capacity when global markets contract?