Tourism, Natural Resource Use and Livelihoods in Developing Countries: A Bioeconomic General Equilibrium Approach

Protecting degraded open-access natural resources while maintaining or improving individuals’ livelihoods is a major challenge, particularly in developing countries. Tourism is often viewed as a win-win solution that can shift natural resource users away from resource extraction and increase local incomes. Existing studies examining the impacts of tourism on natural resource use and livelihoods fail to account for the full suite of effects tourism has on local economies. We offer a new method for assessing the impacts of tourism growth by combining local economy-wide impact evaluation (LEWIE) techniques from development economics with bioeconomic modeling techniques from natural resource economics. We construct our “Bio-LEWIE” model using a novel data set of microeconomic and biological data from the western Philippines. We simulate the impact of a 10 percent increase in tourism expenditures on fishing pressure and local incomes for different socioeconomic groups (e.g., poor households versus nonpoor households). We find that if fish cannot be traded with outside markets, fishing pressure increases and the fish stock declines. The growth in tourism causes households’ real incomes to increase, however they decrease slightly over time due to the decline in the fish stock. In contrast, if fish can be imported, fishing pressure decreases and the fish stock recovers. Real incomes also increase in this scenario, including a small growth in real incomes over time as the fish stock recovers. However importing fish results in smaller overall gains in real incomes (particularly for fishing households), which is due to a leakage of money out of the local economy via fish imports. This model predicts the costs and benefits of tourism growth, when they will occur, and for whom. This framework can help policy-makers in the developing world find synergies between natural resource protection, sustainable livelihoods, and economic growth.

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Q22; O12; Z32
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 Record created 2017-04-01, last modified 2020-10-28

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