Tourism and Economic Development: Evidence from Mexico's Coastline
American Economic Review
vol. 109,
no. 6, June 2019
(pp. 2245-93)
(Complimentary)
Abstract
Tourism is a fast-growing services sector in developing countries. This paper combines a rich collection of Mexican microdata with a quantitative spatial equilibrium model and a new empirical strategy to study the long-term economic consequences of tourism both locally and in the aggregate. We find that tourism causes large and significant local economic gains relative to less touristic regions that are in part driven by significant positive spillovers on manufacturing. In the aggregate, however, these local spillovers are largely offset by reductions in agglomeration economies among less touristic regions, so that the national gains from trade in tourism are mainly driven by a classical market integration effect.Citation
Faber, Benjamin, and Cecile Gaubert. 2019. "Tourism and Economic Development: Evidence from Mexico's Coastline." American Economic Review, 109 (6): 2245-93. DOI: 10.1257/aer.20161434Additional Materials
JEL Classification
- L60 Industry Studies: Manufacturing: General
- L83 Sports; Gambling; Restaurants; Recreation; Tourism
- O14 Industrialization; Manufacturing and Service Industries; Choice of Technology
- O18 Economic Development: Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
- R11 Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
- Z31 Tourism: Industry Studies
- Z32 Tourism and Development