Travel Reference
In-Depth Information
tourism was already overdeveloped. With such increases in land prices, it can be expected that local
residents (with their lower incomes) are effectively
''
chased out
''
of the housing market in a tourism-
developing section.
ECONOMIC MULTIPLIERS
Direct Effect
In addition to the
.
The indirect or multiplier impact comes into play as visitor spending circulates and recirculates. The
direct effects are the easiest to understand because they result from the visitor spending money in
tourist enterprises and providing a living for the owners and managers and creating jobs for employees.
direct impacts
of tourism expenditures on an area, there are also
indirect impacts
Indirect Effect
This visitor expenditure gives rise to an income that, in turn, leads to a chain of expenditure-income-
expenditure, and so on, until leakages bring the chain to a halt. Consequently, the impact of the initial
income derived from the tourist
'
is expenditure is usually greater than the initial income, because
subsequent rounds of spending are related to it. For example, a skier purchases a lift ticket for $60. This
money received by the ski area will be used to pay the wages of the lift operators. The lift operator
spends the money on groceries; the grocer uses the money to pay part of his rent to the local landlady;
the landlady uses it to pay for her dry cleaning; the dry cleaner spends it in a restaurant for a dinner; the
restaurant owner spends it for steaks shipped in from Kansas City; and the cycle stops as the money is
lost to the local economy. This last transaction is known as
from the economy. The
combination of the direct and indirect effects of an expenditure pattern determines the impact. In a
leakage
Shopping is one of the top tourist activities and good for the local economy. The money spent by tourists
circulates and recirculates, creating an economic multiplier.
PhotocourtesyofGlenwoodHotSpringsSport
ShopinGlenwoodSprings,Colorado.
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