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Additional resources for CTH - Introduction to Tourism Economics
However, since travel and tourism touches all sectors of the economy, its real impact is even greater. 5). A C T I V I T Y 1 2 0 m i n u t e s Discuss the impacts of economic recession have on the world’s tourism industry. 3 The demand for tourism The concept of tourism demand originated from the classical definition of demand in economics, namely the desire to possess a commodity or to make use of a service, combined with the ability to purchase it. 1 Tourism consumer behaviour To appreciate patterns of tourism demand we must understand the factors that influence tourist consumer behaviour: The needs, purchase motives and decision process associated with the consumption of tourism The impact of the different effects of promotional tactics The possible perception of risk for tourism purchases, including the impact of terrorist incidents The different market segments based on purchase behaviour The theory of tourism demand is closely related to the study of consumer behaviour and the decision making process (Cooper et al.
As a result, the balance of trade will suffer, affecting employment in exporting industries and in industries producing import-substitutes. Eventually, the exchange rate will be affected. Uncertainty of the value of money and prices If the rate of inflation is imperfectly anticipated, no one has certain knowledge of the true rate of inflation. As a result, no one has certain knowledge of the value of money or of the real meaning of prices. If the rate of inflation becomes excessive, and there is 'hyperinflation', this problem becomes so exaggerated that money becomes worthless, so that people are unwilling to use it and are forced to resort to barter.
The UN defines control in this case as owning 10% or more of the ordinary shares or voting power of an incorporated firm or its equivalent for an unincorporated firm; lower ownership shares are known as portfolio investment. 4 Broadly speaking, a period of slow or negative economic growth, usually accompanied by rising unemployment. Economists have two more precise definitions of a recession. The first, which can be hard to prove, is when an economy is growing at less than its long-term trend rate of growth and has spare capacity.