The Two Sides Of Tourism: The Positive And Negative Impacts On An Economy

Tourism can be a great revenue stream, and economy boost if a community is able to effectively manage it. There are instances that tourism can actually bring a negative impact on a community as well. We will take a dive into the pros and cons of tourism, and what it can mean for society.

What can tourism do for an economy?

• Often, tourism is an incredibly labor-intensive concept. With that being said job creation to satisfy demand is a must. Some major industries that are affected by tourism are transportation, hospitality (hotels), restaurants, and retailers (especially those selling local merchandise). As tourism grows so does the need for employees in each of these industries.
• Some tourist destinations attract visitors based on their breath-taking landscapes. Tourism directly affects an economy’s ability to preserve nature. If you were to take a trip to Machu Picchu in Peru, and the Incan Isle was dismantled, the travesty would also lead to less interest in this world’s wonder. Up keeping natural draws are both great for tourism, and for the environment.

• Direct support to the local economy. If tourism is managed well, and the majority of the tourist dollar is spent at local businesses the economy will experience a direct boost. There is a concept called the multiplier effect that theorizes if money is spent locally than it will more than likely stay in the local economy. This can have major, positive implications on an economy over the long run.

How can tourism hurt the economy?

• If a city is underdeveloped and requires updating infrastructure to host mass quantities of visitors there could be economic downfalls. Take the most recent example of the World Cup hosted in Brazil. The tourism brought in from the World Cup was supposed to be a huge boost to the local economy. Due to the lack of infrastructure in the developing country of Brazil the tourism actually costs the economy more money. These negative tourist experiences also have created other conflicts such as social issues.