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Economic Development And International And Interregional Tourism

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  • Zhang, Wei-Bin

Abstract

Subject and purpose of work: Tourism was the fastest growing industry until the outbreak of Covid-2019. Nevertheless, there are a few studies on how the industry interacts with the rest of economies within a comprehensive analytical framework. The main concern of this study is how international and interregional tourism interacts with national economic development and economic structural change. Tourism and economic growth are investigated in a multi-regional small open economy which is perfectly competitive. Materials and methods: National economy consists of multiple regions and each region has three sectors: industry, service, and housing. Production side is the same as in the neoclassical growth theory. Households move freely between regions, equalizing utility level between regions by selecting housing, goods, tourism, and saving. A region’s amenity is endogenously related to the region’s population. Results: We explicitly solve the dynamics of the multi-regional economy. The system has a unique stable equilibrium point. Conclusions: We simulate the motion of the model and examine the effects of changes in the rate of interest, foreigners’ preference for visiting a region, a region ‘s total productivity of the service sector, domestic consumers’ preference for visiting a region, as well as the propensity to save, the propensity to consume regional services and housing.

Suggested Citation

  • Zhang, Wei-Bin, 2020. "Economic Development And International And Interregional Tourism," Economic and Regional Studies (Studia Ekonomiczne i Regionalne), John Paul II University of Applied Sciences in Biala Podlaska, vol. 13(4), December.
    • Handle: RePEc:ags:plecrs:308909
    DOI: 10.22004/ag.econ.308909
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    More about this item

    Keywords

    International Development;

    JEL classification:

    • Z32 - Other Special Topics - - Tourism Economics - - - Tourism and Development
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

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