ABSTRACT
Point A represents the division of world consumption between residents in the home country and residents in the foreign country, while point B shows the distribution according to a territorial criterion (i.e. between consumption within the home country and consumption within the foreign country). This last division must be taken into account in order to determine the exports and imports of each country. As can be observed in Figure 6.2, both exports and imports are increased by the biased consumption effect. Since tourists are biased towards goods exported from their country of origin, tourism and trade are complementary. It can easily be checked that if the bias is the contrary one, tourism and trade are substitutive. Therefore, if tourists modify their pattern of purchases in the destination, the pattern of trade is affected. This influence on trade can reinforce or reduce the shifting consumption effect. Under unbalanced tourism and asymmetrical behaviour of consumers, the net result depends on the relative importance and the sign of each effect (the shifted consumption effect and the biased consumption effect). To summarize, trade and tourism can be connected by several links. More direct links can be illustrated by the IWE, considering that tourism means a shift in consumption from the origin to the destination of tourists.
