Purpose/aim The aim is to examine the distribution of hotel ownerships and star-rated levels in different regions. This thesis depends on the analysis of the examination to find out if the change of investment behaviors can decrease or avoid the adverse effects of bureaucracy in the Chinese hotel industry. Design/methodology/approach Data has been collected through the third-party electronic distribution channel. The analysis includes a description of the samples and statistical tests. Findings The analysis showed that there is a connection between hotel ownerships, star-rated levels, and different regions. The adverse effects of bureaucracy in the second-tier cities and third-tier cities are stronger than that in the first-tier cities and tourist cities. The state-owned hotels also can do the enterprise transformation in the tourist cities to avoid or decrease the adverse effects of the bureaucracy. Originality/value The original idea is using the hotel ownerships distribution in different regions to find out the different levels of adverse effects of the bureaucracy in different regions. This thesis should be a meaningful contribution to knowledge development.