Tourism sector in Panama: Regional economic impacts and the potential to benefit the poor

Abstract

Tourism is one of Latin America's fastest growing industries, but the impact of tourism on the poor and the effects on developing regions are under debate. Many studies have evaluated the growth impacts of the tourism sector but few have analyzed the impact of tourism on the economy and poverty at the subnational level in developing countries. This paper presents the results of a top‐down assessment of the impact of tourism spending on growth and poverty at the regional level in Panama using a Social Accounting Matrix multiplier model. As revealed by this study, the tourism sector has large multiplier effects on the Panamanian economy — higher than the Panama Canal and almost twice as high as the textiles sector or Free Zone of Colon — and has the potential for significant benefits to the poor, but these benefits depend on where and how supply chains are structured and on the way tourists spend their money.

An Assessment of the Impact of the Tourism Sector on Regional Economic Development in Gauteng Province, South Africa

“…Tourism positively affects regional economic performance. Klytchnikova and Dorosh [29] analysed the role of tourism on regional economic development in Panama's poor regions using a social accounting matrix model. The paper used the impact of tourism spending on growth and poverty at the regional level.…”

Twenty Reasons Sustainable Tourism Counts for Development

“…With a multiplier of 2.87, tourism was more than twice that of textiles at 1.3 and maize at 1.41, in which there are fewer production linkages. 32…”

Do tourism spillovers matter in regional economic analysis? An application to Portugal

“…Examples of those studies include Yang and Wong (2012), Yang and Fik (2014) and Ma et al (2015) which deal with spillover effects of inbound and domestic tourism flows on several Chinese cities and regions. In the same direction, Klytchnikova and Dorosh (2012) discuss leakages effects on regions of Panama, whereas Zhang et al (2007) use data for Denmark and Aguayo (2011) provides evidence for Central and Baltic countries.…”

“…Antonakakis et al, 2015; Balaguer and Cantavella-Jordá, 2002; Chou, 2013; Cortés-Jimenéz and Pulina, 2010; Croes and Vanegas, 2008; Ghali, 1976; Gunduz and Hatemi, 2005; Lee and Chang, 2008; Narayan, 2004; Pérez-Rodríguez et al, 2015; Tugcu, 2014, among others). An important body of literature is also focused on the relationship between tourism development and economic performance at regional and local levels (Burnett et al, 2007; Cortés-Jiménez, 2008; Klytchnikova and Dorosh, 2012; Ma et al, 2015; Paci and Marrocu, 2014; Yang and Fik, 2014; Zhang et al, 2007).…”