chapter  2
23 Pages

Measuring Tourism Spillover Effects Among Cities: Improvement of the Gap Model and a Case Study of the Yangtze River Delta

WithShan Li, Min Xiao, Kun Zhang, Jing Wu, Zheng Wang

The new economic growth theory (Lucas, 1988; Romer, 1986) points out that spillover effects are indispensable for sustainable economic growth and significant for the common growth of a multiregional economy (Caniëls & Verspagen, 2001; Grossman & Helpman, 1991). Employing the “learn by doing” model, Arrow (1962) first used spillover effects as an externality, which arises when a person engages in an activity that influences the well-being of a bystander and yet neither pays nor receives any compensation for that effect (Mankiw, 2009), to explain the spillover effects on economic growth. Grossman and Helpman (1993) primarily pointed out that knowledge spillovers of one country or region bring economic development to nearby countries or regions in which a systematic concept of spillovers emerged as a positive content. Spillover effects, the same as externality, have both positive and negative aspects (Bretschger, 1999; Z. Wang, Gong, & Liu, 2003). Previous studies have shown that such effects also exist widely in the tourism industry (Lazzeretti &Capone, 2009; S. Li & Wang, 2009a), meaning that tourism resources and capital may not only benefit their owners but also bring advantages (positive spillovers) and disadvantages (negative spillovers) to their neighbors. The spillover effects of tourism are usually presented in terms of how the variation in one region’s tourist numbers or income influences the variation of its neighbors (Gooroochurn & Hanley, 2005). Two cities within the same region are probably motivated to cooperate if a positive spillover effect exists between them; for a negative spillover, these two cities will tend to compete. Therefore, to understand the competition and cooperation trends of regional tourism, as well as to develop rationally a regional tourism destination circle, it is necessary to identify those factors affecting tourism spillover and to measure the spillover effects quantitatively.