A Global Perspective: Tourism, Terms of Trade and Welfare of the Poor
Current Strategies in Economics and Management Vol. 5,
Page 14-22
Abstract
The paper investigates the impact of an increase in tourism and a change in the terms of trade on the welfare of different classes in an economy. We set up a three-sector, three-factor (one specific) model of general equilibrium to derive the results. The most important result we obtain is that tourism can immiserize the poor. In the concluding section we argue that a tax on tourism (a non-distortionary tax) should be used to subsidize the poor and restore their welfare level.
Keywords:
- Tourism
- terms of trade
- general equilibrium
- welfare
How to Cite
Hazari, B. R., & Lin, J. (2020). A Global Perspective: Tourism, Terms of Trade and Welfare of the Poor. Current Strategies in Economics and Management Vol. 5, 14-22. Retrieved from https://stm1.bookpi.org/index.php/csem-v5/article/view/1659
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