Tourism and Economic Development Issues - Tourism and Development: Concepts and Issues - page 116

widespread, formal property rights permit massive, low-cost exchanges and,
thus, account for varying economic growth rates and different GDP figures
in different countries. The difference between the export of raw materials
and island beaches is that, through the tourism process, the latter form part
of a tourism supply which might be exported at a negative value for a coun-
try that possesses them if someone outside of the country is collecting their
premium value. Furthermore, premium value might also be lost if external
factors, such as terrorism or political instability, reduce tourism prices to the
lowest possible level.
Second, a possible economic means of addressing the problem of ineq-
uity would be to introduce national financial compensation for not travel-
ling (Mihalič, 1999: 128-131). In other words, travelling represents the 'free'
consumption of the environment and, thus, runs counter to the principle of
equity inasmuch as outgoing tourism remains mainly the privilege of citi-
zens from developed industrial countries. At the same time, of course, the
citizens of poorer countries possess the same right (if not the economic
means) to travel and consume (free) resources. The introduction of financial
compensation for not travelling (paid by travelling nations) would bring
money to developing countries that could be used for future development
programmes that would help close/reduce the gap between rich and poor
countries.

Notes
(1) The estimated span is a result of different methodologies that have been used in
calculations of the contribution of tourism and travel to world GDP. The latest
United Nations World Tourism Organisation (UNWTO) calculation (direct and indi-
rect tourism's contribution to GDP of 5%, and to employment 6-7%) is based on the
country Tourism Satellite Account (TSA) in the 2008 Methodology of the United
Nations Statistics Commission. As relatively few countries have fully comparable
TSA data, the UNWTO estimate is based on still-fragmented information and how
reliable the estimates are is unknown. The WTTC (2011) calculation (travel and
tourism's direct and indirect contribution to GDP of 9%, to employment of 8.6%) is
also based on country TSA data, where available, as well as other data, and comple-
mented by economic modelling developed over the past 20 years that allows cross-
country benchmarking. Experts believe that the WTTC economic calculation is
overestimated, meaning that the WTTC travel and tourism world GDP contribution
estimate might be relatively high. Nevertheless, in this chapter the WTTC data are
used extensively, but for illustration purposes and benchmarking only. Should read-
ers try to derive conclusions from this, it is their responsibility to keep a critical dis-
tance from the different data sources used.
(2) Value added is the difference between the total output, i.e. revenues and the costs of
inputs of raw materials, components or services bought to produce that output. Value
added is the value a firm or industry adds to its bought materials and services through
its own production and marketing efforts.
(3) The capital-output ratio θ is calculated as follows:

θ = K ( t )/ Y ( t )