Travel and Tourism in Perspective: Nature, Scale and Importance
What this domain covers
This domain tests whether you can define the visitor economy precisely and explain its scale and importance with evidence rather than adjectives. Examiners look for accurate use of visitor, tourist and excursionist, recognition that tourism is a composite product, and the ability to trace money through an economy.
Core rules and concepts
- A visitor travels outside their usual environment for under a year for leisure, business or other purposes and is not employed by the place visited. Visitors are tourists (overnight) or excursionists (same-day).
- Tourism is an invisible export: inbound visitors bring foreign currency in, while outbound spending is an import.
- Direct effects come from businesses serving visitors; indirect effects from their suppliers; induced effects from the spending of wages earned.
- The multiplier counts how many times visitor money re-circulates locally; it is higher where local supply chains are strong.
- Leakage is money leaving the local economy: imports, foreign-owned profits, repatriated wages.
- Importance: employment, foreign exchange, tax revenue, infrastructure shared with residents, and destination image.
Worked example
An island records 400,000 international arrivals a year; average spend per visit is US$900. Gross spending = 400,000 x 900 = US$360 million. Leakage is estimated at 45%, leaving US$198 million circulating locally. With a local multiplier of 1.8, total contribution is about 198 x 1.8 = US$356.4 million. Reasoning: multiply arrivals by spend first, deduct leakage before applying the multiplier, and explain why the multiplier is modest (small island, high import content).
Traps that cost marks
- Calling a same-day cruise passenger a tourist; they are an excursionist.
- Adding leakage after the multiplier, which overstates impact.
- Writing "tourism creates jobs" without job type, scale or example.
- Quoting global figures with no date or source.