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Tourism, Welfare and De-industrialization in a Small Open Economy

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Copeland, Brian R

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Abstract

This paper investigates the effects of an expansion of tourism on welfare, output, and factor prices in the host country using a general equilibrium international trade model. In the absence of taxes, foreign ownership, and distortions, an increase in foreign visitors will increase welfare only if the price of nontradables increases. Factor mobility and foreign ownership tend to reduce the gains from tourism, while commodity taxes tend to increase them. Conditions under which an increase in tourism can lead to deindustrialization are also discussed. Copyright 1991 by The London School of Economics and Political Science.

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Publisher Info
Article provided by London School of Economics and Political Science in its journal Economica.

Volume (Year): 58 (1991)
Issue (Month): 232 (November)
Pages: 515-29
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Handle: RePEc:bla:econom:v:58:y:1991:i:232:p:515-29

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  1. Pasquale M. Sgro & Jean-Jacques Nowak & Mondher Sahli, 2004. "Tourism, Trade and Domestic Welfare," Working Papers 2004.24, Fondazione Eni Enrico Mattei. [Downloadable!]
    Other versions:
  2. Kazuhiro Testu, 2006. "Tourism Promotion and Regional Development in Low-income Developing Countries," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 45(3), pages 417-424. [Downloadable!]
  3. Majah-Leah Ravago & James Roumasset & Kimberly Burnett, 2008. "Resource management for Sustainable Development of Island Economies," Working Papers 200804, University of Hawaii at Manoa, Department of Economics. [Downloadable!]
  4. Vanegas, Manuel & Croes, Robertico, 2007. "Tourism, Economic Expansion and Poverty in Nicaragua: Investigating Cointegration and Causal Relations," Staff Papers 7306, University of Minnesota, Department of Applied Economics. [Downloadable!]
  5. Chi-Chur Chao & Bharat R. Hazari & Jean-Pierre Laffargue & Pasquale M. Sgro & Eden S. H. Yu, 2005. "Tourism, jobs, capital accumulation and the economy: A dynamic analysis," PSE Working Papers 2005-16, PSE (Ecole normale supérieure). [Downloadable!]
    Other versions:
  6. Rinaldo Brau & Alessandro Lanza & Francesco Pigliaru, 2003. "How fast are tourism countries growing? The cross country evidence," Working Paper CRENoS 200309, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia. [Downloadable!]
  7. Gawande, Kishore & Maloney, William & Rojas, Gabriel V. Montes, 2007. "Can foreign lobbying enhance development ? The case of tourism in the Caribbean," Policy Research Working Paper Series 4275, The World Bank. [Downloadable!]
  8. Rinaldo Brau & Alessandro Lanza & Francesco Pigliaru, 2003. "How Fast are the Tourism Countries Growing? The cross-country evidence," Working Papers 2003.85, Fondazione Eni Enrico Mattei. [Downloadable!]
  9. Allison Zhou & Carl Bonham & Byron Gangnes, 2007. "Modeling the supply and demand for tourism: a fully identified VECM approach," Working Papers 200717, University of Hawaii at Manoa, Department of Economics. [Downloadable!]
  10. Rabah Arezki & Reda Cherif & John Piotrowski, 2009. "Tourism Specialization and Economic Development : Evidence from the UNESCO World Heritage List," IMF Working Papers 09/176, International Monetary Fund. [Downloadable!]
    Other versions:
  11. Elena Bellini & Ugo Gasparino & Barbara Del Corpo & William Malizia, 2007. "Impact of Cultural Tourism upon Urban Economies: An Econometric Exercise," Working Papers 2007.85, Fondazione Eni Enrico Mattei. [Downloadable!]
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