Is tourism growth able to shrink economic inequalities? A DSGE analysis
The aim of this paper is to investigate the relationship between inbound tourism and economic inequalities (income and wealth). We construct a dynamic stochastic general equilibrium (DSGE) small open-economy model that includes the tourism industry and the housing market. We focus on the recent Icel...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
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Elsevier
2023-05-01
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| Series: | Annals of Tourism Research Empirical Insights |
| Subjects: | |
| Online Access: | http://www.sciencedirect.com/science/article/pii/S2666957923000046 |
| _version_ | 1797798551293526016 |
|---|---|
| author | Hongru Zhang Yang Yang |
| author_facet | Hongru Zhang Yang Yang |
| author_sort | Hongru Zhang |
| collection | DOAJ |
| description | The aim of this paper is to investigate the relationship between inbound tourism and economic inequalities (income and wealth). We construct a dynamic stochastic general equilibrium (DSGE) small open-economy model that includes the tourism industry and the housing market. We focus on the recent Icelandic tourism boom, and our simulation results suggest a reduction in income inequality and an increase in wealth inequality. Inbound tourism thus has opposite effects on domestic income inequality and wealth inequality, so the Icelandic government faces a trade-off when formulating tourism-related policies to reduce inequalities, and the consequences may depend on the type of inequality that policymakers prioritize. Lastly, implications are provided based on results. |
| first_indexed | 2024-03-13T04:06:29Z |
| format | Article |
| id | doaj.art-975ceec330804a6ca82f9e99753b0be5 |
| institution | Directory Open Access Journal |
| issn | 2666-9579 |
| language | English |
| last_indexed | 2024-03-13T04:06:29Z |
| publishDate | 2023-05-01 |
| publisher | Elsevier |
| record_format | Article |
| series | Annals of Tourism Research Empirical Insights |
| spelling | doaj.art-975ceec330804a6ca82f9e99753b0be52023-06-21T07:01:10ZengElsevierAnnals of Tourism Research Empirical Insights2666-95792023-05-0141100089Is tourism growth able to shrink economic inequalities? A DSGE analysisHongru Zhang0Yang Yang1School of Liberal Arts, Macau University of Science and Technology, Macau 999078, China; Corresponding author.Department of Tourism and Hospitality Management, Temple University, Philadelphia, PA 19122, USAThe aim of this paper is to investigate the relationship between inbound tourism and economic inequalities (income and wealth). We construct a dynamic stochastic general equilibrium (DSGE) small open-economy model that includes the tourism industry and the housing market. We focus on the recent Icelandic tourism boom, and our simulation results suggest a reduction in income inequality and an increase in wealth inequality. Inbound tourism thus has opposite effects on domestic income inequality and wealth inequality, so the Icelandic government faces a trade-off when formulating tourism-related policies to reduce inequalities, and the consequences may depend on the type of inequality that policymakers prioritize. Lastly, implications are provided based on results.http://www.sciencedirect.com/science/article/pii/S2666957923000046Inbound tourismIncome inequalityWealth inequalityDynamic stochastic general equilibrium (DSGE) modeling |
| spellingShingle | Hongru Zhang Yang Yang Is tourism growth able to shrink economic inequalities? A DSGE analysis Annals of Tourism Research Empirical Insights Inbound tourism Income inequality Wealth inequality Dynamic stochastic general equilibrium (DSGE) modeling |
| title | Is tourism growth able to shrink economic inequalities? A DSGE analysis |
| title_full | Is tourism growth able to shrink economic inequalities? A DSGE analysis |
| title_fullStr | Is tourism growth able to shrink economic inequalities? A DSGE analysis |
| title_full_unstemmed | Is tourism growth able to shrink economic inequalities? A DSGE analysis |
| title_short | Is tourism growth able to shrink economic inequalities? A DSGE analysis |
| title_sort | is tourism growth able to shrink economic inequalities a dsge analysis |
| topic | Inbound tourism Income inequality Wealth inequality Dynamic stochastic general equilibrium (DSGE) modeling |
| url | http://www.sciencedirect.com/science/article/pii/S2666957923000046 |
| work_keys_str_mv | AT hongruzhang istourismgrowthabletoshrinkeconomicinequalitiesadsgeanalysis AT yangyang istourismgrowthabletoshrinkeconomicinequalitiesadsgeanalysis |