Green Economy Adoption and Profitability: The Serial Mediation of Smart Tourism and Business Saving
DOI:
https://doi.org/10.61194/ijjm.v7i4.2236Keywords:
green economy adoption, smart tourism, business saving, profitabilityAbstract
Tourism micro and small enterprises (SMEs) in Central Java, Indonesia, face increasing pressure to adopt green economy practices while maintaining profitability in a competitive and digitally transforming tourism environment. This study examines whether smart tourism capability and business saving behaviour explain the relationship between green economy adoption and profitability among tourism SMEs in Semarang City and Pekalongan Regency. The novelty of this study lies in developing and testing a serial mediation model linking Green Economy → Smart Tourism → Business Saving → Profitability, thereby integrating sustainability orientation, tourism-related digital capability, and internal financial behaviour in a single explanatory pathway. Using a cross-sectional survey of 250 tourism SME owners/managers, the data were analysed using PLS-SEM with reflective constructs measured on a 5-point Likert scale. The results show that green economy adoption was positively associated with smart tourism capability (β = 0.431, p < 0.001), smart tourism capability was positively associated with business saving behaviour (β = 0.273, p < 0.001), and business saving behaviour was positively associated with profitability (β = 0.243, p = 0.015). Green economy adoption was not directly associated with profitability in this sample (β = −0.141, p = 0.100), whereas the serial indirect effect through smart tourism capability and business saving behaviour was statistically supported (β = 0.029, p = 0.046). These findings suggest that green economy adoption may become financially meaningful when supported by tourism-related digital capability and disciplined business saving behaviour. Practically, tourism SMEs and local policymakers should integrate green-transition initiatives with smart tourism enablement and basic cash-flow and saving routines. Given the cross-sectional and self-reported design, the findings should be interpreted as evidence of an associated serial indirect pathway rather than definitive causal sequencing.
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