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Economic impact of tourism in Cabo Verde: a CGE analysis

Author

Listed:
  • K. Ali Akkemik

    (Fukuoka University)

  • Jorge Tavares Borges

    (Yamaguchi University)

  • Denes Perlaky

    (Yamaguchi University)

Abstract

Tourism, a major economic activity in Cabo Verde, contributes largely to GDP and employment. The long-run economic impact of tourism in Cabo Verde is examined using a dynamic computable general equilibrium model and simulation analyses where the demand for tourism is increased by 10%, and the tax burden is reduced by half. Results show real GDP rising above its long-run growth path by 1.31 and 1.00 percentage points in 2030 and by 0.61 and 0.47 percentage points in 2050 in the demand and supply shocks, respectively. Despite considerable leakage, these shocks lead to improvement in the primary budget balance.

Suggested Citation

  • K. Ali Akkemik & Jorge Tavares Borges & Denes Perlaky, 2024. "Economic impact of tourism in Cabo Verde: a CGE analysis," International Journal of Economic Policy Studies, Springer, vol. 18(1), pages 173-195, February.
    • Handle: RePEc:spr:ijoeps:v:18:y:2024:i:1:d:10.1007_s42495-023-00124-w
    DOI: 10.1007/s42495-023-00124-w
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    More about this item

    Keywords

    Cabo Verde; Small island developing states; Tourism; CGE;
    All these keywords.

    JEL classification:

    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism
    • Z38 - Other Special Topics - - Tourism Economics - - - Policy

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