Contribution of tourism to socio economic growth and development.
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Explanation:
tourism is commonly considered to be a facilitator of socio-economic development, especially in less-developed countries (LDC’s) and peripheral and/or rural areas. Tourism development is also proclaimed to be an important pillar for achieving UN Millennium Development goals—i.e. poverty, hunger, gender inequalities and environmental degradation can be alleviated through sustainable development of tourism. Conversely, however, tourism development is also said to cause social, environmental and cultural degradation. Accordingly, while there is no doubt that tourism development can have a significant impact on communities, the real nature of its role and impact is questionable. The aim of this paper is to examine this particular issue by analyzing the relationship between the relative size of tourism, measured by the tourism satellite account (TSA) approach, and the degree of socio-economic development, measured by the human development index (HDI). Moreover, the paper also tries to investigate whether socio-economic development is driven by tourism development, or is it the other way round? To shed light on these relationships and the direction of possible influence, this study uses correlation analysis and Granger causality testing. The results of this study seriously call into question the validity of common belief that tourism can be a strong initiator of socioeconomic development in less developed countries.