Current Issues in Tourism
Editor: C. Michael Hall (Department of Management, College of Business and Economics, University of Canterbury, Christchurch, New Zealand) and Chris Cooper (Foundation Professor of Tourism, University of Queensland, Australia) Michael and Chris are joint editor of the book series Aspects of Tourism. Reviews Editor John Jenkins (University of Newcastle, NSW, Australia)
|
Volume: 3 Number: 4 Page: 325–363
|
|
|
|
|
Economic Impacts of Inbound Tourism under Different Assumptions Regarding the Macroeconomy
|
|
Larry Dwyer, Peter Forsyth, John Madden and Ray Spurr
|
|
On what is taken to be the 'Standard View', increased tourism expenditure from inbound markets has direct, indirect and induced effects on a host destination, leading to increased production, income and
employment. Strong links between tourism and other sectors of business reduce import leakages from tourism expenditure thereby enhancing the multiplier effects of the injected expenditure on domestic output,
value added and employment. The usual technique for analysing these effects is input-output analysis. This paper argues that economy-wide effects must be taken into account in determining the impacts of
increased tourism expenditure on a destination, and that the 'Standard View' is superficial and very often misleading. An expanding tourism industry tends to 'crowd out' other sectors of economic activity,
reducing the demand for traditional exports and import competing industries. The extent of these 'crowding out' effects depends, in turn, on the workings of labour markets, changes in prices and the real
exchange rate, and the macroeconomic policy context. It is argued that these mechanisms can only properly be taken into account using Computable General Equilibrium (CGE) models rather than input-output
modelling. The paper then looks at applications of CGE modelling to tourism growth in both nations and regions, classifying the various studies according to assumptions made about labour markets and government
policies. The discussion has relevance for estimating the economic contribution of tourism in all destinations. The paper concludes with some observations regarding the use of CGE modelling in tourism contexts
internationally and issues for further research.
© Channel View Publications 2000
Full text PDF
|
