Tourism and the Economy

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Tourism and the Economy
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Tourism Trade Balances

• Tourism can be looked at as an export/import
  commodity
• A travel deficit is when a country has more
  people leaving the country to travel than
  tourists visiting the country
• A travel surplus is when a country has more
  tourists visiting the country than people leaving
  to travel in other countries.
• In terms of the economy it is better to have a
  positive tourism trade balance to avoid the
  leakage of revenue to other countries.

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Multiplier Effect

• Tourism is a revenue producer and much of this
  revenue goes back into the local economy.
• The multiplier effect is when tourism revenue
  trickles down through the region, benefiting just
  about everyone in the community.

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Multiplier Effect - continued

• Tourism creates direct jobs through airlines,
  hotels, car rentals, travel agents, and tour
  operators.
• Tourism also creates indirect jobs in
  agriculture, mining, manufacturing, services, etc.

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Multiplier Effect Example
Waterloo Inn Hotel
Master K Front Desk Employee Free Style Rapper
Salary





Mortgage
Food
Entertainment
Transportation
Services
Mister T Yoga Instructor
Missy V Lounge Singer/Naturpath
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Leakage

• Occurs when the community cannot support the
  influx of tourists and must import workers and
  goods in order to sustain the industry.
• OR when the movement of money (tourist ) out of
  the economy of the country in which it was spent
  to other countries (usually developed)
• Produces a negative effect on the economy because
  the money leaks out of the system.
• Example Whistler Many Australians working to
  support the tourists in the ski resorts.

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Leakage Example
Whistler Lodge Ski Resort
Beau D Front Desk Employee Snowboader/Surfer
Salary





Student Loans In Australia
Food
Entertainment
Transportation
Services
T-Dog Snowboard Instructor
Sheila V Nightclub Owner
Line of Credit California
Credit Card New Zealand
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Ripple Effect

• The ripple effect refers to the money that is
  generated from tourism sales, and how it then
  moves throughout the economy.
• Example

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Economic Tourism Cost/Benefits
Problems
Benefits

• Increased prices of goods.
• Crime costs (policing and security)
• Health costs to take care of tourists.
• Waste management costs.
• Seasonal employment problems
• Wear and tear of facilities.

• Job variety
• Wages earned by industry and through
  multiplier/ripple effect
• Tax dollars generated
• Foreign currency gained
• Funding to improve infrastructure in the area