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Tourism growth and regional resilience

Author

Listed:
  • João Romão

    (CEFAGE – UAlg, University of Algarve, Portugal)

  • João Guerreiro

    (CIEO, University of Algarve, Portu)

  • Paulo M. M. Rodrigues

    (Bank of Portugal and Nova University of Lisbon, Portugal)

Abstract

As a consequence of the international financial crisis in 2007, the region of Algarve, where tourism plays an important economic and social role, suffered a decrease in tourism demand, while unemployment increased sharply. Although tourism activities registered a quick recovery, unemployment levels continued to grow. This article examines the impacts of tourism activities on the sectorial structure of the regional economy, using a Bayesian vector autoregressive model. The results reveal that tourism growth did not automatically create the expected positive impacts on the economic performance of the other sectors, as was expressed by the objectives defined in the regional development strategies over the last two decades. The positive impacts of tourism were concentrated in the production of non-tradable goods and the construction sector, leading to a significant reduction of the weight of the tradable sector within the regional economy, similar to a process of deindustrialization described as the ‘Dutch disease’. The decline of construction activities after 2007 has led to a significant increase of regional unemployment, although tourism growth has returned to ‘pre-crisis’ levels, revealing the lack of regional resilience.

Suggested Citation

  • João Romão & João Guerreiro & Paulo M. M. Rodrigues, 2016. "Tourism growth and regional resilience," Tourism Economics, , vol. 22(4), pages 699-714, August.
    • Handle: RePEc:sae:toueco:v:22:y:2016:i:4:p:699-714
    DOI: 10.1177/1354816616654243
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    Cited by:

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    2. repec:cfe:wpcefa:2017_01 is not listed on IDEAS
    3. Giotis Georgios, 2022. "Preliminary Results on the Employment Effect of Tourism. A meta-analysis," Papers 2206.00174, arXiv.org.
    4. Romão, João, 2020. "Tourism, smart specialisation, growth, and resilience," Annals of Tourism Research, Elsevier, vol. 84(C).
    5. Blesilda P. Badoc-Gonzales & Ma. Belinda S. Mandigma & Jackson J. Tan, 2022. "SME resilience as a catalyst for tourism destinations: a literature review," Journal of Global Entrepreneurship Research, Springer;UNESCO Chair in Entrepreneurship, vol. 12(1), pages 23-44, December.
    6. Luis Delfim Santos & Ana Catarina Vieira, 2020. "Tourism and regional development: a spatial econometric model for Portugal at municipal level," Portuguese Economic Journal, Springer;Instituto Superior de Economia e Gestao, vol. 19(3), pages 285-299, September.

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