This topic will provide an overview of the relationship between tourism and the economy, discussing key concepts and theories in tourism economics.
Introduction to Tourism Economics – Study Notes
| Term | Meaning | Example |
|---|---|---|
| Tourist | Person who travels away from usual residence for ≥ 24 hrs and ≤ 1 yr, primarily for leisure, business, or other non‑permanent purposes. | A family vacationing in Bali for two weeks. |
| Tourism Demand | Desire and ability of travelers to purchase tourism goods and services. | Rising demand for eco‑tourism experiences. |
| Tourism Supply | All goods, services, and infrastructure offered to tourists (accommodation, transport, attractions, etc.). | Hotels, airlines, theme parks. |
| Direct, Indirect & Induced Effects | Direct: Spending by tourists on tourism services. Indirect: Business‑to‑business purchases needed to deliver those services. Induced: Household spending generated by wages earned in the tourism sector. |
|
| Multiplier Effect | The ratio of total economic impact (direct + indirect + induced) to the initial direct spending. | |
| Tourism Satellite Account (TSA) | A standardized framework (UNWTO) for measuring tourism’s contribution to GDP, employment, and investment. | |
| Seasonality | Fluctuations in tourism activity over the year. | Beach destinations peaking in summer. |
| Carrying Capacity | The maximum number of tourists a destination can accommodate without degrading resources or visitor experience. |
Determinants of Tourist Demand
Tourist Expenditure Patterns
Elasticities
Key Supply Elements
Cost Structure