ABSTRACT
Tourism events contribute to local tourism industry success and often enhance quality of life for residents. These same events draw revenues away from businesses outside the region in the short run and attract investment from outside the region in the long run (Heilbron and Gray 1993). While there is no unique formula for cooperation among tourist destinations and there are significant impediments to its success (McCarthy 2003), future regional economic development is expected to depend more on cooperation than on competition (Gordon 2009). The common reliance on traditional economic impact analysis to promote activities and events
runs counter to the critical role of regional cooperation in economic development strategies (Lombard and Morris 2010). Specifically, economic impact analysis as traditionally practised does not thoroughly consider the full spatial impacts of tourism events, promoting analyses that ignore (often negative) impacts in areas that are not the central focus of the analysis. That is, economic development costs or benefits to the larger region are overlooked. Instead, the success of an event is measured by the amount of direct expenditures (or a multiple of it) captured by a specific ‘local’ study region as chosen by the analyst. Little thought is given to the fact that the analysis, in doing so, implies a competitive perspective between localities; costs to a larger region are ignored in the pursuit of narrow local economic impacts. Among the many shortcomings of this spatially myopic approach is that a combination of self-interested activities by numerous localities within a broader region may lead to lesser benefits than otherwise similar activities that were better coordinated and incorporated a broader perspective towards economic impacts. More broadly,
the competition between local governments for economic development is generally regarded as producing both inefficiencies and inequities. Competition forces governments to increase subsidies and incentives offered to private firms, favors new firms over existing businesses, and often results in merely the relocation of investment rather than in increased levels of private sector activity.
