IMPACT OF

TOURISM
Types of TOURISM IMPACTS

ECONOMIC IMPACTS

SOCIO-CULTURAL
IMPACTS

ENVIRONMENTS
IMPACTS
TOURISM AND ITS
ECONOMIC IMPACTS
Direct Economic Impacts
• Impacts are generated directly through
tourism expenditure.
• Tourist income generate income and
jobs in hotels, attractions, TO,TA
ÞTOURIST’S EXPENDITURE  generate
economic impact in places that are not
an important part of tourism industry.
Indirect Economic Impacts
Tourist expenditure indirectly increases
the local economy by purchasing (food)
-> Businesses have the benefit from
tourism industry although they are not
in tourism sector
Induced economic impacts
The result of expenditure by people of
the region, who have been directly or
indirectly affected by tourist
expenditure.
If pp’s income is better through tourism-
> they will spend more -> local
business will have more benefits.
 Economic Impacts
Positive Negative
Income generate COSTS (direct costs/
indirect costs,
opportunity costs)
Employment generation Inflation
Contribution to Over-dependence
Government revenue
(TAX)
Balance of payment Seasonality
Improvement economic Seasonal character of
Economic impacts of Tourism
Income generation: via tourism activities
Employment generation: numbers of jobs
are generated
+ jobs : low-skilled -> do not need extensive
training
(suitable for country having unemployed young
pp, the long-term unemployed , the less-
skilled, ethnic minority groups.)
TAX REVENUE GENERATION
TAXES : the income of Government.
A TAX: a user charge
an involuntary payment to the
Government
the payer do not receive any
direct benefit or equivalent value in
return.
TAX REVENUE GENERATION
TAXES Tourism -> (1) Tourism business
(2) Tourists
Why do the Government need
TAXES?
to create revenue to correct market
failure (markets provide little / too
many)
 TAX REVENUE GENERATION
Tourists – use public goods but they do
not pay for (using parks, pavement…
having a security environment )
Who paid? Local people (not fair)
-> TAX targeting Tourists is used to
recuperate/ fulfill these costs
 BALANCE of PAYMENTS
- Is a systematic record of all
transactions between residents of one
country and the rest of the world
- MONEY INTO COUNTRY – CREDITS
- MONEY LEAVING - DEBITS
Credits > Debits -> surplus (dư)
Debit > Credits -> deficit (developed
Countries)
IMPROVEMENT of the ECONOMIC STRUCTURE
Refer to the contribution one industry/ sector
-> make to other sectors in the economy of
the host community.
ENCOURAGEMENT of ENTREPRENEURS ACTIVITY
Large Companies: in charge of the
organization, information and transport,
whereas small companies are directed towards
welcoming tourists, hospitality and leisure
The smaller companies : are mostly
characterized by self- employment and small
family firms (b/c many tourism businesses do
not require large amounts of investment to set
up)
ECONOMIC DISADVANATAGES
COSTS
Tourism -> bring money to economy
-> bring the costs to the local community
The costs are paid BY PUBLIC MONEY (depend on
taxes paid by local community )
COSTS are divided into 3 kinds
- DIRECT (1)
- INDIRECT (2)
- OPPORTUNITY (3)
Direct costs (1)
- are directly linked to the provision of
tourism products or services.
INDIRECT costs (2)
- Are not directly linked to goods and
services, but that rise when the
volume of tourists in the destination
rises
OPPORTUNITY costs (3)
- what you give up to make a choice.
- the opportunities that are lost because of
the development of tourism.
Ex: You decide to get a part-time job. Which
one of these is NOT an opportunity cost
when you are working?
a. Time to sleep c. time with your
family
b. Time to play games d. time-sharing
INFLATION
- a rise in the general level of prices or a fall in the
purchasing power of money.
Tourism causes INFLATION
+ demand for a certain product (land to build
Hs /Rs)
+ this resource is limited
-> Prices for land increases -> local pp cannot
buy
=> DEMAND- PULL inflation (economy increase
rapidly – demand cannot follow)
OVER-DEPENDENCE
TOURISM -> bring economic benefits
Over-dependence on tourism -> economic
will be affected
Why? B/c a decrease in demand for
destination
a new competitor
a economic downturn
-> Causes impacts on revenue and
employment
SEASONALITY
A DESTINATION
+ have high season
+ low season
-> Seasonality can have various
negative economic impacts on
destinations
INCREASED PROPENSITY to IMPORTS
-The economic benefits of tourism can be
decreased strongly if the destination
becomes more dependent on imports
because of tourism development.
How measure the impact of Tourism on
employment.
1) Counting the N0 individuals employed
Counting the N0 jobs generated
-> 2 figures are different ( jobs: are done by part-time
staff)
Cannot measure b/c Tourism is a heterogeneous sector
(khg đồng nhất)
jobs are directly generated by tourism
Jobs are indirectly created
Tourism employment is measured by
translating EXPENDITURE / CONSUMPTION
into A NUMBER OF JOBS using A LABOUR
COEFFICIENT /RATIO (hệ số/ tỉ lệ lao động)
Using RATIO of Tourist expenditure -> to predict
the number of jobs