From Heritage Resources to Revenue Generation: A Predictive Structural Model for Heritage-Led Local Economic Development

Understanding the economic performance of heritage-rich towns requires a systematic evaluation of how heritage-related components collectively contribute to revenue generation. Existing studies often examine heritage assets, socio-cultural factors, physical infrastructure, and local economic conditions independently, resulting in fragmented insights that limit comprehensive planning for local economic development. This study develops and validates an integrated Cultural Heritage Economy Model that quantifies the influence of heritage resources, social, physical, and economic aspects on revenue generation in heritage contexts. The model is conceptualized through a structured synthesis of theoretical literature and domain-specific indicators, followed by construct operationalization, expert validation, and pilot-level assessment. Using Structural Equation Modelling (SEM-PLS), the study demonstrates strong reliability, convergent validity, discriminant validity, and significant structural relationships. The predictive relevance of the final model is further evaluated through PLSpredict, confirming its suitability for future estimation. The findings confirm that revenue generation is a product of the combined and mutually reinforcing effects of heritage, socio-cultural, physical, and economic dimensions, rather than just by the influence of heritage resources. By offering this novel, empirically grounded, multidimensional framework to estimate heritage-driven economic outcomes, this research establishes a foundational model that can guide evidence-based resource allocation, policy formulation, and long-term sustainable urban development planning.