Tourism Economics
Chapter 1
TRM 490
PROF. ZHOU
Chapter 1: Intro to Tourism
• Two important organizations for
Information on world tourism
– World Tourism Organization (WTO)—An UN
Agency
– The World Travel and Tourism Council
(WTTC)---A Private Organization
Chapter 1: Intro to Tourism (2)
• Estimates of tourism’s economic impact
vary widely according to the definition of
tourism used
– Tourism, an umbrella concept (The world
except US)
– A traveler is variously defined as someone
making a trip for a specified distance (25m,
50m or 100mi) and for some specified
purpose (leisure, business, for example) away
from home
Chapter 1: Intro to Tourism (3)
• Tourism Economics measures the amount
of travel and its economic consequences,
direct, indirect, and induced.
– The measurement of economic impact varies
according to various methods of collecting
and defining travel information
• Tourism has other dimensions, too
– Psychological, sociological, ecological and
political impacts
Chapter 1: Intro to Tourism
(4)
• Tourism rubric: see Figure 1-1, p4
• Perspectives on tourism:
– As an activity: in which people are engaged in travel
away from home for various purposes
– As a business providing goods and services to the
travelers
– As an industry comprised of hundreds of component
businesses
– As an economic development tool
– As an institution with a history, body of knowledge and
social aspect
– As an economic activity with billions of dollars
exchanged each month---tourism economics
Chapter 1: Intro to Tourism
(5)
• Various definition of traveler/tourist:
– US Government: both mean the same---anyone who
stays more than 24 hours, or make an overnight stay,
away from home. (Exceptions: military travel, resident
students, resident student immigrants, diplomats, and
people working away from home).
– The US Census Bureau: travel at least 100 miles
away from home and returns (overnight stay is not a
requirement in the definition)
– Statistics Canada: a tourist is one who travel away
from home for a distance of at least 50 miles beyond
the boundary of the home community.
Chapter 1: Intro to Tourism (6)
• WTO’s view on inbound tourism/tourst/traveler/visitor:
– In most circumstances, the precision of the definitions is not a
special concern, and all sorts of travelers might be included in
the statistics of visitors. This also concerns their expenditure.
Nationals residing outside the country are unevenly treated
(some exclude them from their statistics of inbound visitors) and
many countries are mostly worried by foreigners residing outside
the country (confusion between the concept of nationality and of
residence).
– Same-day visitors are usually excluded from the theoretical
definition (although their expenditure might be included), and it is
also the case of transit visitors (specifically excluded in previous
international definitions).
– Business travels were always considered of special interest, and
in many cases were identified separately. Some countries also
identified separately other purposes of the visit.
Chapter 1: Intro to Tourism (7)
• Issues in studing tourism economics
– Definition of tourism will continue to be imprecise
because so mnay busineses, governments and the
researchers are involved
– The reliability and validity of the numbers developed
by primary research (various definition and sampling
techniques)
– Tourism statistics should be taken with a grain of salt
since so many sectors of industry and so many
people are involved.
Chapter 1: Intro to Tourism (8)
• The Scope and Magnitude of Tourism
Economics
– US: the third largest retail industry, following food and
automobile industries
– US: the largest private employer
– US: the largest export industry
– US: the largest recipient of tourist travel income
– US: Spend the most tourist dollars abroad (see Figure
1-6, p13)
Chapter 1: Intro to Tourism (9)
• Tourism income and impact studies
– Child & Waters study: trips to places more
than 20 miles away from home, including
foreign visitor spending. See figure 1-7
– US Data Center: trips 100 miles away from
home, but includes indirect spending (impact)
– Every US state conducts its own tourism
impact study. See figure 1-8
Chapter 1: Intro to Tourism (10)
• Examples of Spending Categories
– Retail shopping
– Restaurants
– Lodging
– Recreation
– Ground transport
– Food stores
– Air transport
– Travel arrangement
Chapter 1: Intro to Tourism (11)
• New Tourism Markets
– China and Southeast Asia
– India