- Tourism-led development
- Tourism-led development is a strategy in which a country builds hotels, transport and attractions so that foreign visitors' spending raises local incomes and earns foreign currency.
- Primary product dependency
- Primary product dependency is when a country relies on exports of one or a few raw materials, such as crops or minerals, for most of its foreign currency.
Three ideas for weighing tourism
Can you name the three ideas an answer on tourism and development has to weigh?
One says how far visitors' spending spreads; two say why it may spread less than it seems.
The expenditure multiplier is the idea that a change in spending causes a more than proportionate change in GDP, because one person's spending becomes another person's income.
Can you think of an example?
A visitor pays a guesthouse, the owner pays a local cook, and the cook spends her wage in the village shop, so one payment becomes several incomes.
Leakage is the part of visitors' spending that flows out of the country, on imported supplies or as profit sent to foreign owners, instead of becoming local income.
Can you think of an example?
An all-inclusive resort owned abroad flies in its wine and cheese and sends its profit to head office, so little of a guest's bill stays on the island.
Seasonality is the rise and fall of visitor numbers through the year, so hotels and guides have plenty of work in some months and little in others.
Can you think of an example?
A beach resort is full in the dry season and half shut in the rainy season, so many of its staff are hired for only part of the year.