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Tourism's Forward and Backward Linkages

Author

Listed:
  • 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)

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.

Suggested Citation

  • Junning Cai & PingSun Leung & James Mak, 2005. "Tourism's Forward and Backward Linkages," Working Papers 200516, University of Hawaii at Manoa, Department of Economics.
  • Handle: RePEc:hai:wpaper:200516
    as

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    File URL: http://www.economics.hawaii.edu/research/workingpapers/WP_05-16.pdf
    File Function: First version, 2005
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    References listed on IDEAS

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