ABSTRACT
With hindsight, it is not difficult to analyse the factors that have made some private sector investment projects in the recreation, leisure and tourism sector such successes and others such dismal failures. The failures include airlines such as Air Berlin, Kingfisher and Monarch and the tour operator Thomas Cook whilst successes include projects as diverse as films, visitor attractions (Legoland, Denmark; Port Aventura, Spain) and electronic devices (iPhone, iPad). However, at the planning stage, it is much more difficult to forecast the success of investments, largely because of the uncertainty surrounding the future. This chapter defines the meaning of investment, considers how potential investment projects are appraised and stresses the shortcomings of quantitative techniques. This chapter enables the reader to:
define and distinguish between different types of investment
analyse the factors which affect an investment decision
utilize techniques for investment appraisal
understand the uncertainty surrounding investment appraisal
analyse the effects of investment on the economy
evaluate government policy with regard to investment.
