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Modelling Tourism Impacts on Small Island Economies: Evidence from Cyprus, Malta and Mauritius |
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M. Thea Sinclair,
Professor; Adam Blake, Lecturer; and Nishaal Gooroochurn |
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Tourism and Travel
Research Institute, Nottingham University Business School,
Jubilee Campus, Nottingham, United Kingdom |
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Abstract |
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Tourism has become one of
the leading economic activities in many small island developing
states. Hence, changes in tourism demand can have considerable
economic impacts, both at the macroeconomic level and
on different sectors within the economy. Measurement of
the magnitudes of the impacts has traditionally been undertaken
using input-output modelling, which is constrained by
such assumptions as fixed prices and fixed coefficients.
Input-output modelling may over-estimate the impacts,
as it does not take account of crowding out effects. This
paper will use the more widely encompassing approach of
Computable General Equilibrium (CGE) modelling to quantify
the impacts of tourism on the island economies of Cyprus,
Malta and Mauritius. The CGE models will quantify the
impacts of changes in tourism demand on macroeconomic
variables such as the government budget and welfare and,
at the sectoral level, on income, employment and value
added for tourism-related sectors such as hotels and restaurants,
as well as on all other sectors of the economies. The
effects of policy changes will also be modelled and discussed. |
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Assessing the Effects of an Increase in Tropical Cyclone Activity on the Tourism Sector-
The Case of Mauritius |
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Sanjeev K. Sobhee,
Associate Professor |
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Department of Economics
and Statistics, University of Mauritius, Reduit, Mauritius |
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Abstract |
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Our aim in this paper will
be to analyse the effects of an increase in tropical cyclone
activity as indicated by global warming on tourism in
a small island developing state. Mauritius constitutes
our specific case study in which we approach the impact
through observed market demand conditions for the island’s
tourism. This is done primarily by setting two objectives,
namely, the estimation of a demand function for tourism,
based on the Travel Cost method, and the computation of
the monetary implications of potential climate change.
We intend to apply more precisely a Travel Cost model
for a single site in which the choice problem of international
travelers will be addressed. Needless to add, this will
involve an optimization framework whereby the travel cost
demand function will be obtained. This function will capture
specificities of Mauritius and may well involve an ecological
variable. In addition, the explanatory variables would
include a climatological factor. We intend to track global
warming and extreme weather conditions via tropical cyclone
activity in the South West corner of the Indian Ocean.
The relevant empirical demand function will be estimated
using panel data pertaining to tourist arrivals from 14
countries spanning across a period of 17 years (1987-2003).
Our findings would help to analyse the specific effects
of climate change on tourist arrivals and the subsequent
impact on earnings of the sector. |
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Development of Coastal Tourism and Homestays on Dachangshan Dao, Liaoning Province
North East China |
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Gu Ming & Wong
Poh Poh, Associate Professor |
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Department of Geography,
National University of Singapore, Singapore |
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Abstract |
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In China, tourism is
being actively developed and is evolving towards a more
open-economy form. Coastal tourism is encouraged but
has come into conflict with other uses and sustainable
development is an issue. Dachangshan Dao, the largest
island in the Changshan island group in Liaoning Province,
off the Yellow Sea, provides an opportunity to assess
one form of island tourism under development. The study
provides valuable lessons on the local community’s
involvement in island tourism. In response to domestic
tourism demand at Yangjia Beach on Dachangshan Dao,
the government has allowed the farmers on this beach
to convert their farms into homestays. This paper analyzed
the morphological changes of the farms into homestays
and the transformation of the local farmers to homestay-owners.
As tourism develops, conflicting interests have emerged
between the tourists, the local community groups (e.g.
farmers, fishers), the private developers, and the government
agencies. The nature of empowerment, conflicts, or harmony
among the different stakeholders was studied and the
power structure behind these phenomena was analyzed.
In addition, the current accommodation capacity, the
facility capacity, and the infrastructure (e.g. drainage
system, sewage disposal) of the homestays were assessed.
Policy, legislation and planning relating to the homestays
were also evaluated. Finally, improvements to the homestays
and their future were discussed. |
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Designing Tourism Taxation in a Small Island Industrialising Economy |
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Nishaal Gooroochurn,
Lecturer |
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Economic Division,
Nottingham University Business School, Jubilee Campus,
Nottingham, United Kingdom |
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Chris Milner, Professor |
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School of Economics,
University of Nottingham, University Park, Nottingham,
United Kingdom |
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Abstract |
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Tourism is one of the
fastest growing sectors and has an important contribution
in the economy of several small island economies. In
the face of budgetary constraints and pressures to decrease
reliance on a variety of taxes, especially trade taxes,
several countries are relying on tourism taxes. Indeed,
there is an economic rationale for tourism taxes in
so far as they correct for market failure and generate
revenue that governments can use for such purposes as
redistribution, infrastructure provision or to sustain
the development of the sector. As tourism taxes proliferate,
businesses and consumers are pressing the government
for reductions in both the range and levels of tourism
taxes on the grounds that they constitute a disincentive
to demand, profitability and investment. Moreover, taxes
can be inefficient and inequitable, if not set at appropriate
levels, and may lead to retaliation by other countries.
Clearly, tourism taxation has become a contentious issue
and, given its growing importance in several countries,
it is important to understand and measure its economic
underpinnings and effects. This paper uses a Computable
General Equilibrium (CGE) model of Mauritius to investigate
the efficiency, income distribution, macroeconomic,
sectoral and tax revenue effects of various forms of
tourism taxation. The economic effects of substituting
the hotels and restaurants tax by the VAT are also investigated.
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Public Cultural Expenditures and Tourism Industry: The Case of Mauritius |
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Kheswar Chandan Jankee,
Senior Lecturer |
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Department of Economics
and Statistics, University of Mauritius, Mauritius |
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Islanders Exoticism: Case Stories from Mauritius Island, Indian Ocean |
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Khemraj Sooknah, Projects
Coordinator, and Nazmeen Parbotteea |
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Mauritian Wildlife Club,
Mauritius |
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