Estimation of the Market Size of Medical Tourism Industry Using Grey Models -- Case Study in South Korea

South Korea (Korea) is a highlight of medical tourism in Asia in the recent years. It has become an attractive destination with the large number of foreign patients around the world. Although, the businesses of medical tourism in this country are quickly expanding, its market size is still unclear due to the shortage of statistical number. Therefore, this study aims to employ forecast tool to estimate the number of foreign patients in Korea in the future. To conduct, the grey forecast has been utilized to construct several forecast models based on the data of foreign patients in Korea from 2009 to 2014. Empirical results indicated that, the GM(1,1) model was presented best forecasted performance with high precision (from 92.1% to 96.7%), compared with the Verhulst model (from 45.5% to 81.3%) and the DGM(2,1) model (from 71.3% to 94.9%). According to the forecasted results of GM(1,1) model, the foreign medical tourists visit to Korea will increase significantly year-on-year. Korea's medical tourism market will attract to 1,378,954 foreign patients in 2020, up to approximately four times from 352,976 in 2015. Among that, to 2020, the number of medical tourists in department of cosmetic and plastic surgeries will achieve 483,615 patients. In addition, for the origin of medical tourist, the number of Chinese and American medical tourist will be estimated to reach 1,163,965 and 82,227 patients respectively in 2020.