Modelling the economics of sustainable tourism

Abstract

To date tourism has been synonymous with intense territorial use, which has led to a reconsideration of the relationship between tourism and its location in order to foster more environmentally-friendly development. In this context, the paper provides a novel approach to the analysis of tourism and the environment by developing a theoretical general equilibrium model addressing the integration of the environment in the economic system (i.e. in a circular economy) from a tourism perspective. The model’s innovative aspect is in assuming the use of land not only as an input, but as an output. Specifically, the land is no longer supplied in a fixed quantity to the economy, but society decides between its enjoyment or its rental as a factor of production; thereby achieving a more rational use of this resource. Likewise, its consideration as an output allows us to stress its role as an asset; implying that its preservation also contributes to economic growth. The main findings show that, when the environment is integrated into the economic system, tourism is not a source of ecological depletion, but rather an essential contributor to its preservation. However, this necessary integration does not keep tourism from eroding sectoral diversification and reinforcing import dependence.

Keywords:

• sustainable tourism
• theoretical general equilibrium model
• circular economy
• economic growth

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

1 Hernández and León (2013) and Marsiglio (2015) also provide interesting and similar metodological approaches to the interaction between tourism and the environment. Nevertheless, they both specifically focus on the latter relationship and omit other sectoral and economic interactions.

2 While in real life both land and environment refer to the same concept, the model distinguishes between them as a way of emphasizing the private use of the environment by the tourism sector, from the use of it made by the rest of society. Moreover, it also emphasizes the preservation and improvements made by this sector when demanding land and generating added-value through its preservation as a tourism attribute (better environment). This assumption could be relaxed by assuming both variables as equal, yielding similar results to the base model. The only difference is that the price of the land falls, instead of rising, because of the new land supplied by the tourism sector.

3 Retrieved from the Spanish National Statistical Institute: https://ine.es/dyngs/INEbase/en/operacion.htm?c=Estadistica_C&cid=1254736177058&menu=resultados&idp=1254735576581