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Tourism's Forward and Backward Linkages

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Author Info
Junning Cai (Department of Economics, University of Hawaii at Manoa)
PingSun Leung (Department of Economics, University of Hawaii at Manoa)
James Mak () (Department of Economics, University of Hawaii at Manoa)

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Abstract

This paper proposes “linkage analysis” as a complement to the traditional “tourism impact analysis” to examine tourism’s economic imprints on a destination’s economy. Although related, the two methods are not the same. The starting point of tourism “impact analysis” is “final demand”; impact analysis measures the direct and indirect impacts of tourist spending on the local economy. By contrast, the starting point of “linkage analysis” is the tourism sector; the analysis examines the strengths of the inter-sectoral forward (FL) and backward (BL) relationships between the tourism sector and the non-tourism industries in the rest of the economy. The FL measures the relative importance of the tourism sector as supplier to the other (non-tourism) industries in the economy whereas the BL measures its relative importance as demander. Directly applying conventional linkage analysis to tourism is not straightforward because tourism is not a defined industry. Thus we develop a methodology to calculate tourism’s forward and backward linkages using information from national, regional, or local input-output tables and demonstrate its utility by applying it to Hawaii.

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File URL: http://www.economics.hawaii.edu/research/workingpapers/WP_05-16.pdf
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File Function: First version, 2005
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Paper provided by University of Hawaii at Manoa, Department of Economics in its series Working Papers with number 200516.

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Length: 31 pages
Date of creation: 2005
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Handle: RePEc:hai:wpaper:200516

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