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Economic, Environmental & Socio-cultural Considerations - Aritro Dasgupta
Measuring Economic Impacts
Still not registered as a separate sector in many countries but included as part of services
Thus very difficult to come up with exact measurement of tourism in the economy
World Tourism Organization (WTO) has developed Standard International Classification of Tourism Activities (SICTA) to specify which are the activities which can be categorized under & measured by quantitative measures
Economic Measurements
Income generated & contribution to GDP/GNP
Net foreign exchange earned from international tourism
Contribution to government revenues including tourist user taxes, airport departure taxes, customs duties on imported goods used in tourism, income taxes on tourism enterprises & employees, property taxes on tourism establishments etc.
Economic Measurements 
Local employment generated
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Multiplier effect
Local Employment Generation
Direct employment
Indirect employment
Induced employment
Construction employment
Multiplier Effect
Multiplier is a factor of proportionality that measures how much an internal variable changes in response to a change in some external variable
Internal variable is one which originates within the system
External variable is one which originates outside the system
It is the effect where the addition of certain variables leads to an exponential impact
Multiplier Effect
In tourism sector, per unit of direct spending in the sector leads to generation of investment many times more
Spending may be divided as- primary, secondary & induced
Primary is the direct expenditure
Secondary is the derived expenditure resulting from related activities
Induced is the spending which results from an automatic rise in living standards which arises out of the above 2 causes
Multiplier Effect
Multiplier effect is more high in tourism than in most other sectors because of the labour-intensive nature of the industry
Effect is greater in underdeveloped countries with a greater dependence on tourism as a source of foreign exchange
The spread of tourism revenue in an economy is usually more even due to the large number of players in the market
Tourism revenue also stays within shores of a country, dos not get ‘shipped’ out
Features of Tourism Economics
Helps justify & pay for transportation facilities
Catalyst for expansion of other economic sectors
For some forms of tourism, there may be no alternatives besides foreign investment If not carefully controlled, tourism can generate serious economic problems
Economic Problems of Tourism Economics
Economic leakage
Economic distortions may take place geographically if tourism is concentrated in 1 area
Economic distortions may also take place if tourism attracts too many skilled employees from other industries; problem particularly acute in smaller states/countries
Tourism may also induce financial burden on the local population
Enhancing Economic Benefits
Techniques must be applied during planning process to enhance economic benefits of tourism
Strengthening linkages between tourism & other economic sectors
Usage of more local items for food, building materials, interior decoration
Encouraging local ownership of tourism facilities
Occasionally when capital is limited, foreign investment may be allowed initially
Enhancing Economic Benefits 
Foreign hotel management may take away a substantial chunk of revenue; however they provide professional management, international marketing, modern reservation techniques
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Maximizing local employment through proper training of personnel
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More shopping facilities may indirectly enhance economic benefits as greater sales will lead to increased sales taxes
Environmental Impacts
Positive Environmental Impacts 
Helps justify & pay for conservation of important natural areas & wildlife; particularly crucial for countries with limited resources
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Helps justify & pay for conservation of important archaeological & historic sites as attractions for tourists; sometimes entire districts/ towns preserved for such purposes
Positive Environmental Impacts 
Provides incentive for long term environmental clean-up
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Increases local environmental awareness
Negative Environmental Impacts
Water pollution especially through improper sewage management
Air pollution
Noise pollution
Visual pollution – poorly designed hotels, badly planned layout of facilities, inadequate landscaping, ugly advertising signs etc.
Waste disposal problems
Negative Environmental Impacts
Damage to archaeological historical sites
Environmental hazards & land use problems
Ecological disruption of natural areas
Environmental Protection Measures
Install properly designed utility systems of water supply, electric power, sewage, solid waste disposal & drainage; recycling of waste water & use of solar heating devices
Provide open space, parks & suitable landscaping
Develop adequate road & transportation systems, emphasis on public transit; electric shuttle buses can be used in resorts
Environmental Protection Measures 
Apply environmentally suitable land use & site planning principles, zoning regulations, development standards, architectural design & control of advertising signs
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Manage visitor flows; technique of modeling
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Prohibit tourists to cut trees in camping & trekking areas, to collect rare plant & animal species or disturb natural behaviour patterns of wild animals; only controlled fishing & hunting
Environmental Protection Measures
In marine areas, controls required on following:
Operations related to ship bilge cleaning & ballast dumping
Use of motorized boats
Collection of live sea shells
Use of boat anchors in corral bottom bays
Spear fishing
Disturbance of nesting turtles
Mining of beach sand & coral for construction purposes
Socio Cultural Impacts
Positive Socio Cultural Impacts 
Improves living standards of people & helps pay for community facilities & services
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Conserves cultural heritage of area
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Reinforces / renews sense of pride by residents in their culture when they observe tourists appreciating it; especially for societies experiencing rapid change
Positive Socio Cultural Impacts 
Helps develop & maintain museums, theatres & other cultural facilities
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Opportunity for cross cultural exchange
Negative Socio Cultural Impacts
Overcrowding & loss of convenience for local residents
Loosening of sense of cultural identity
Excessive commercialization & loss of authenticity of local customs, ceremonies, music, dance, crafts etc.
‘Demonstration effects’
Problems of drug abuse, alcoholism, crime, prostitution
Preventing Socio Cultural Problems
Maintain authenticity of local dance, music, drama, arts, crafts & dress
Preserve existing, distinctive local architectural styles & encourage new development including tourist facilities, to use local architectural motifs
Make certain, residents have convenient access to tourist attractions
Inexpensive/ subsidized facilities for residents
Preventing Socio Cultural Problems
Educate residents about tourism- concepts, benefits & problems; involve them in policy development
Inform tourists about local society
Train employees to work in tourism effectively including language & social sensitivity
Strict control on drugs, crime & prostitution
Environmental Impact Assessment (EIA)
EIA is an assessment of the possible positive or negative impact that a proposed project may have on the environment, together consisting of the environmental, social & economic aspects
If analysis finds a project to cause harm, then project must not get go-ahead
Usually an EIA results in some modification of tourism projects
Components Examined Under EIA
Environmental auditing procedures
Limitations to natural resources
Environmental problems & conflicts that may affect project viability
Flora, fauna, soil, water, landscape, cultural sites etc.
Use of renewable, non-polluting forms of energy if any
Application of 3 Rs- Reduce, Reuse, Recycle
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