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2.5. The moderating role of governance and policy support
The successful translation of micro-level adaptive capacity into macro-level
destination resilience and regenerative tourism does not occur in a vacuum; it is
significantly contingent upon the broader institutional environment. Governance and
policy support encompass the regulatory frameworks, digital infrastructure investments,
financial incentives, and ethical guidelines established by public authorities to facilitate
technology adoption. In the context of AI, effective governance involves not only
promoting innovation through capacity-building programs and robust digital
infrastructure but also ensuring data privacy - such as adherence to the General Data
Protection Regulation (GDPR) - and mitigating algorithmic biases.
This study posits that local governance and policy support act as critical moderating
variables. When tourism SMEs operate within a highly supportive policy environment, the
positive impact of their adaptive capacity on destination resilience and regenerative
practices is substantially amplified. Strategic public-private partnerships and government
interventions can help SMEs overcome high initial investment costs and technical barriers
associated with AI implementation. Conversely, inadequate policy support, lack of
regulatory clarity, or insufficient digital infrastructure can stifle SMEs' ability to fully
operationalize their AI capabilities, thereby weakening the pathway to sustainable
destination recovery.
2.6. Proposed research model and hypotheses
Based on the integration of the Resource-Based View (RBV) and socio-ecological
resilience theory, alongside the empirical literature reviewed, this study proposes a
conceptual model mapping the causal pathways from SME AI readiness to destination-
level outcomes. Consequently, the following hypotheses are formulated:

Figure 1. Conceptual model
Source: Proposed by authors
H1: SME AI Readiness has a significant positive effect on Organizational Adaptive
Capacity.
H2: Organizational Adaptive Capacity has a significant positive effect on Destination
Resilience.
H3: Organizational Adaptive Capacity has a significant positive effect on
Regenerative Tourism practices.
H4: Organizational Adaptive Capacity positively mediates the relationship between
SME AI Readiness and Destination Resilience.

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