Modeling economic growth with tourism for small open economies

Stauvermann, Peter J. and Kumar, Ronald Ravinesh ORCID: 0000-0001-9658-4896 (2017) Modeling economic growth with tourism for small open economies. Metroeconomica : International review of economics, 68 (4). pp. 1001-1018. ISSN 1467-999X

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The purpose of the paper is to develop an economic growth model and analyze the impact of changes in tourists’ income on the growth of tourism dependent small open economies. We use a general theoretical construct to answer the question of how the price elasticity of tourism demand, income elasticity of tourism demand, and the concentration in the service sector influence the economic development of small economies. One of the main results is that the policy planners in small open economies may consider specific policies to influence the strength of market competition. An ensuing effect of such policies is that the labor incomes will increase. The approach provides a microeconomic foundation for macroeconomic modeling which can be used for applied research, and the model can be easily extended to examine other dimensions of economic development.

Item Type: Article
Divisions: Institute of Management > Bolton Business School
Depositing User: Tracey Gill
Date Deposited: 01 Feb 2018 09:42
Last Modified: 08 Mar 2018 11:43
Identification Number: 10.1111/meca.12161

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