ABSTRACT
The previous two chapters examined tourism within a predominantly domestic context and this chapter extends the discussion to the international arena. Tourism has been one of the highest growth activities in the world during the 1980s and 1990s, in terms of both expenditure and foreign currency generation. The high levels of tourism expenditure have significant implications for both tourist origin and destination countries, contributing to a worsening of the balance of payments of net tourism generator countries and an improvement of that of net recipients. Hence, tourism can raise or lower a country’s dependence upon other countries and can be of particular importance to developing countries whose economies, apart from tourism, are based on primary products. While over the long term both domestic and international tourism can make a significant contribution to a country’s economic growth, its potential for generating income and employment within a destination may be constrained by the country’s ability to supply the goods and services which tourists wish to consume. Tourists’ consumption of food and beverages which are imported from their country of origin, in hotels owned and managed by fellow nationals, is a prime example of the leakages of receipts from a destination. Therefore, since the pattern of tourism supply and associated distribution of receipts have considerable effects on countries’ economies and welfare, it is useful to provide some explanations of the patterns which occur on a global scale. International economics can help to provide such explanations, which are the prerequisite for the formulation of policies designed to alter the cross-country structure of production. The discussion builds on the industrial economics analysis in Chapters 4 and 5 by examining tourism supply in an international context.
