AVTOUR 2101: TOURISM 1

TOPIC 1: THE ECONOMICS OF TOURISM

The role of Tourism in Economic Development: Several developing countries have used tourism development as an alternative to help
economic growth.

1. Continuous demand for international travel in developed countries.

2. As income in developed countries increases, the demand for tourism also increases at a faster rate.
3. Developing countries need foreign exchange to aid their economic development

Organization for Economic Cooperation and Development (OECD) has concluded that tourism provides a major opportunity for growth for
countries that are at the intermediate stage of economic development and require more foreign exchange earnings.

1. In tourism, the consumer collects the product from the exporting country, thereby eliminating the freight costs for the exporter, except
in cases in which the airline used are those of the tourist receiving country.
2. The demand for pleasure travel is largely dependent on non-economic factors, such as local disturbances, political unrest, and changes
in the fashion ability of resorts/countries created mostly by media coverage.
3. By using specific fiscal measures, the exporting or tourist receiving country can manipulate exchange rates so that those for tourists
are higher and lower. (Ex. Normally the latter is implemented in order to attract large number of tourists than those in other foreign
trade markets. Also, tourists are allowed to buy domestic markets at the same price as the local residents (duty-free tourist shops)
4. Tourism is a multifaceted industry that directly affects several sectors in the economy. (such as hotels, shops, restaurants, local
transport firms, entertainment establishment, and handicraft producers)
5. Tourism brings many more non-monetary benefits and costs than other export industries, such as social, cultural, and environment
benefits, and costs.

Economic Impact: When travelers outside the destination area spend on goods and services within the destination, tourism acts as an export
industry by bringing in revenues from outside sources. Tourism’s economic impact on a destination area can be immense since it provides a
source of income, employment, and foreign exchange.

Direct and Secondary Effects: In order to measure the economic impact of tourism on the destination area, it is important to know the direct and
secondary effects of visitor expenditures on the economy of the area.

1. The term direct means that the income is received directly: received as income by businesses such as hotels, restaurants, car
rentals, tour operators, and retail shops serving tourists have a direct effect on the economy of the host area.
2. Indirect or secondary effects mean that the money paid by tourists to businesses are in turn used to pay for supplies, wages of
workers, and other items used in producing the products or direct services bought by tourists.

Tourism Multiplier: the term multiplier is used to describe the total effect, both direct and secondary, of an external source of income introduced
into the economy. Tourism multiplier or multiplier effect is used to estimate the direct and secondary effects of tourist expenditures on the
economy of a country.

A tourist makes an initial expenditure into the destination. This expenditure is received as
income by local tour operators, handicrafts store owners, hoteliers, and taxi drivers. In the
first round of transactions, a hotelier may use some of the money received to buy some supplies, pay some wages, and retain some profits. The
income in the second round may be spent or saved, while the employee who has received payment for services rendered may spend some of it on
rent and some on food, and may put some into savings. The money spent on supplies in the third round of spending goes for such things as seed,
fertilizers, and imported raw materials. Any income spent on imports has leaked out of the local economy. This process continues until the
additional income generated by a new round of spending essentially becomes zero. Leakage is the value of goods and services that must be
imported to service the needs of tourism. To estimate the total economic impact on an area, imports must be subtracted from the income generated
by visitors.

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The formula for tourism multiplier is:
Where: K= the multiplier
Y= the change in income generated by E
E= the change in expenditure (initial sum of money spent by the tourist)
The size of the multiplier depends on the extent to which the various sectors of the economy are linked to one another.
When the tourism sectors buy heavily from other local economic sectors for goods and services, there will be a smaller tendency to import and
the multiplier will be greater than if the reverse were true.
A simplified formula for tourism multiplier is:

where: K = the multiplier

L = the direct first-round leakages
c = the tendency to consume
cj = the proportion of that propensity spent abroad
tic=the indirect tax
td= the value of direct deductions (income tax, national insurance, and so on)
b = the level of government benefits
m = the value of imports
Most developing economies have an income multiplier range between 0.6 and 1.2, while developed economies have a range
between 1.7 and 2.0.

How to Maximize the economic effect of Tourism:

A. Growth Theories- some economic growth theories have been proposed to maximize the economic effect of tourism within a
destination area. These are the theory of balanced growth and the theory of unbalanced growth. Proponents of the theory of balanced
growth suggest that tourism should be viewed as an important part of a broad-based economy. This theory stresses that tourism needs
the support of other industries. Its objective is to integrate tourism with other economic activities. To obtain maximum economic
benefit, tourism goods and services should be locally produced. The theory of unbalanced growth see tourism as the spark to economic
growth. While the proponents of the theory of balanced growth stress the development of supply, supporters of the theory of
unbalanced growth emphasize the need to expand demand. As demand is increased through the vigorous development of tourism,
other industries will move to provide products and services locally.
B. Economic Strategies- the key to maximizing the economic effects of tourism is to maximize the amount of revenue and jobs
developed within the region. To attain this objective, some economic strategies have been adopted, such as import substitution,
incentives, and foreign exchange.
C. Import Substitution- It imposes quotas or tariffs on the importation of goods, which can be developed locally. It also grants subsidies,
grants, or loans to local industries to encourage the use of local materials. Its objective is to minimize the leakage of money.
D. Incentives- the wise use of incentives can encourage the influx of capital, both local and foreign, necessary to develop tourism supply.
(ex: tax exemptions/loans at low rates of interest)
E. Foreign Exchange- many countries have placed restrictions on spending in order to maximize foreign exchange earnings. They have
limited the amount of their own currency that tourists can bring in and take out of the destination to ensure that foreign currency is
used to pay bills in the host region. Tourists may be required to pay hotel bills in foreign currency. Visitors may be required to show
that they have enough money for their stay before they are permitted to enter the country or they may even be required to enter with a
specified amount of foreign currency for the duration of their visit.

TOPIC 2: THE SOCIOLOGY OF TOURISM

Is an emergent specialty concerned with the study of touristic motivations, roles, relationships, and institutions and of their impact on tourists and
on the societies who receive them. Sociology of Tourism helps us to analyze the impact of an individual passing through a system as well as a
large number of tourists, establish the transformational impact of tourism on people, places and communities and their way of life, planning and
development of sustainable.

The social nature of travel: travel is brought about by the social nature of man. Human beings, as social animals, feel comfortable in a tour
group. They feel that their trip is more enjoyable and freer from anxiety if they join a group tour. Camaraderie often develops friendships that last
for years. In some subcultures, travel is the accepted way of spending one’s vacation. Sabbatical leaves and foreign assignments make it possible
for university faculty members and employees to travel and develop a passion for it. Tourism evolves a mutual trust and respect for one another
and the dignity of life on earth. According to Pope John Paul II, “The world is becoming a global village in which people from different
continents are made to feel like next-door neighbors, tourism can help overcome many real prejudices and foster new bonds of fraternity.”

The social effects of tourism: Tourism is concerned with the movement and contact between people in different geographical locations. In
sociological terms, this involves:
1. Social relations between people who would not normally meet;
2. the confrontation of different cultures, ethnic groups, lifestyles, languages, level of prosperity, and the like;
3. The behavior of people released from many of the social and economical constraints of everyday life; and
4. The behavior of the host population which has to reconcile economic gain and benefits with the costs of living with strangers.

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Socioeconomic Variables and Their Effect on Travel
A. Age- There are several differences between patterns of travel based on age. Younger people tend to select more active recreational
activities rather than older people. The elderly (those in the late sixties and upward) prefer more passive forms of recreation, such as
visiting friends and relatives, fishing, sightseeing, and playing golf. Older tourists tend to travel to farther destinations, prefer ship
travel, travel more in spring than younger tourists do, and spend less than middle aged, tourists but more than younger tourist.
B. Income and Social Status- Income and social status have a great influence on travel. Rich persons, as well as persons with higher
social status, travel more than those with lower income and social class status. Higher income tourists stay longer and spend more per
day than those with lower incomes.
C. Education- There is a strong correlation between education and travel. Generally speaking, the better educated members of the
population have a greater desire to travel. Researchers have found that the more educated the travelers are, they tend to be more
sophisticated in their tastes. They prefer activities that require the development of interpretative and expressive skills, such as
attending plays, concerts, art museums, reading books, playing golf and skiing.
D. Life Stages of the Family- The presence of children in the family limits travel. More leisure time is spent at home. As the children
grow up and leave home, the married couples renew interest in travel. Couples in this life stage usually have more flexible income and
are more financially capable to travel.
The Rise of New Travel Patterns
A. Travel Clubs- The most significant development in group travel consists of travel clubs. A very good example of these is the Club
Mediterranee which is started in Western Europe and the spread to North America and other areas of the world. In this group travel
plan, a club member enjoys travel opportunities and vacation destination facilities at a much cheaper price than that paid by a non-
member. The accommodations offered by the club range from deluxe to very modest. There is also a wide choice of locations, climate,
and other vacation features.
B. Airline Group and Arrangements- Another development in group travel is the introduction of different types of tour fares promoted
by airlines. These are the following:
1. Group of 15 or more are given reduced fares;
2. Charter service is given by some airlines to affinity group tours which are intended for those affiliated to a legitimate
group for a period of six months or longer;
3. Public charter in which an entire airplane is made available to a group of persons who travel to the same destination and;
4. Incentive tours which are given by firms to employees as a reward for a special achievement or as a motivation for
achievement.
C. Special Interest Tours- special interest group travel is becoming more popular at present. These are tours arranged for those who interested in
a particular activity such as bird watching, festivals, fishing, hunting, scuba diving, photography, flower arrangement, golf skiing, mountain
climbing etc
Preferences of the International Tourist- the preferences of the international tourist are divided into four categories namely;
A. Relaxation versus Activity- before, the workweek for most people including the middle class was long and exhausting. Thus, they
demanded holidays that offered relaxation and rest. At present, the workweek has been shortened and the annual holiday leave has
been lengthened. Work has become less tiresome and people have become used to greater leisure. Relaxation has become possible
throughout the year. Accordingly, people have started to use their no holiday time leisure to exercise new activity skills such as sailing,
climbing, horse riding and sports. The demand activity-oriented travel has greatly increased.
B. Familiarity versus Novelty- in general, most tourist on their first trip abroad to seek familiarity rather than novelty. They search for
something that will remind them of home, whether it be food, newspapers, living quarters or another person form their own country. A
soon as they find a place where they feel at home, these tourists will go back to the same place for a number of times. Not until they
have gained more experience in traveling will they want to go to a new environment – to see customs and cultures different from their
own, and to mix with people who speak differently, eat differently, and dress differently. Tourist move away from traditional resorts to
new tourist destinations.
C. Dependence versus Autonomy- in the past, tourists joined package tours in which transportation, lodging, food, sightseeing and
entertainment we fixed in advance by the tour agency. At present, there is the emergence of a group of tourists who would like to
acquire a sense of personal autonomy regarding their leisure time. They would like to travel on their own and not part of a group. They
would like to feel independent – in complete control of what they do and how they do it.
D. Order versus Disorder- in the past, tourists sought holidays which enforce the traditional concept of conformity – set meals at fixed
times, guidebooks which told them the right places to visit and resorts where their fellow tourists were tidy, well behaved, and
properly dressed. They avoided situations where their adult imposed sense of orderliness might be offended. Now, the new generation
of tourist is not very much concerned about what to wear and how to behave when on holiday. Informality in behavior, a greater
tolerance toward the differences of others, and freedom from institutionalized regulations are now the characteristics of the modern
traveler. Because of social and economic changes in modern society, the demand for travel will be based less on familiarity, relaxation,
dependence, and order, but more on novelty, activity, autonomy and informality.
Types of Tourist Roles- the continuous combination of novelty and familiarity forms the basic variable for the sociological analysis of the
phenomenon of modern tourism.
A. The Organized Mass Tourist- This type of tourist is the least adventurous. He buys a package tour in which the itinerary of his trip is
fixed in advance and his stops are well prepared and guided. He seldom makes decisions for himself. He prefers a familiar
environment rather a new environment.
B. The Individual Mass Tourist-The individual mass tourist is similar to the organized mass tourist, except that the individual mass
tourist has a certain degree of control over his time and itinerary and is bound to a group. However, all the major arrangements of his
tour are still made through a travel agency. Like the organized mass tourists, he also travels within his own country and goes out of it
occasionally. Familiarity is still dominant, but less than the organized mass tourist. The desire for novelty is greater for the individual
mass tourist.
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 C. The Explorer- This type of tourist arranges his trip by himself and looks for comfortable accommodations and reliable means of
transportation. He tries to associate with the people he visits and to speak their language. The explorer dares to leave his country much
more than the previous two types, but goes back to it when the experience becomes too rough. Although novelty dominates, the
explorer does not adopt completely the lifestyle of the host country. He still retains some of the basic practices and comforts of his
native way of life.
D. The Drifter- the farthest away from the accustomed ways of life of his own country. He is almost totally immersed in his host culture.
He tries to live the way the people he visits live and to share their shelter, food and habits. He retains only the most basic of his native
customs. He arranges his own trip and does not seek the help of a tour agency. He does not have a fixed itinerary. Novelty is at its
highest; familiarity disappears almost completely.

TOPIC 3: TOURISM & CULTURE

Culture can be defined as a “set of beliefs, values, attitudes, habits and form of behavior that are shared by a society and are transmitted from
generation to generation”. A knowledge of the culture of a country is important in order to understand how individuals within that country will
behave.

Cultural tourism is one of the largest and fastest growing tourism markets in the world. The relationship between tourism and culture is
changing rapidly due to lifestyle changes, new forms of culture and creativity, and the development of new technologies.

Tourism-related cultures are less specific, more accessible and bottom-up than they used to be. This has created challenges and opportunities for
countries around the world to develop and leverage many synergies between tourism and culture. The culture has immeasurable inherent value for
embracing the community and constitutes itself. It is one of the most important assets for tourism. Similarly, the tourism industry.

Promotion and preservation of tangible and intangible heritage while promoting development of arts, crafts and other creative activities, tourist
destinations how much of their charm a culture that can transform traditional tourism into creative tourism and provide more credibility and the
actual experience. However, poorly managed tourism can also have a negative impact. About cultures and heritage that affect the long-term
sustainability of both tourism and nature and cultural area.

The Importance of Cultural Tourism includes all aspects of travel in which people learn about each other’s way of life. Thus, tourism is an
important means of promoting cultural relations and international cooperation.

Types of Cultural Tourists

Cultural tourists with a purpose whose main travel motivation is cultural tourism. These tourists have a very deep cultural experience. Cultural
tourism is the main reason for visiting destinations, but the experience is of a more superficial nature. Tourism Cultural tourists.

Casual Cultural Tourists do not travel for cultural reasons, but after attending they have a deep cultural tourism experience, while casual
cultural tourists are less motivated to culture, resulting in a surface experience.

Accidental cultural tourist is someone who does not travel for cultural tourism, but still participates in some activities and has superficial
experience. Accidental cultural tourists, who enjoy a deep cultural experience, but play little or no role in travel decisions. This type of tourist is
so diverse that there is no favorite activity resulting from it.

Occasional cultural tourists play a medium role in travel decisions and enjoy minor cultural experiences. Their favorite activity is to visit
attractions and temples that are not as easy to access and explore as cultural tourists traveling.

Cultural factors with Tourist Appeal: In tourism, here are the cultural factors that have great attraction to tourists.

• Art- generally, the arts include performing arts and fine arts. The former refers to live theater, music, and dance and the latter
includes painting, sculpture, graphic arts, and architecture. (ex: performing arts Pangkat Kawayan (bamboo orchestra), rondolla
group. Fine arts Amorsolo and Francisco painting and sculptural works Michelangelo)
• Music and Dance- music is a major source of enjoyment and satisfaction to tourists. Resort hotels in particular can give the
visitors many opportunities to enjoy the best local music.
• Handicraft- to satisfy tourists, gifts, and souvenirs for sale should be manufactured in the country where the purchase is made.
Usually, a tourist is dissatisfied when he buys a particular souvenir and then discovers later that the article he bought was made
in another country.
• Industry and Business- international travelers are usually curious about the country’s industry, commerce, manufactured
products, and its economic situation.
• Agriculture- the agriculture of a country may be interesting to a large segment of tourist. An important aspect of tourist services
in rural areas is the farmers market in which local agriculture products are sold to the travelers.
• Education- the inhabitants of one country are usually anxious to know the educational system of another country. Campuses of
colleges and universities of a country are particularly appealing to tourists. Many of them have beautiful landscapes and are
ideally situated for an enjoyable and enlightening visit.
• Literature and Language- literary achievement of a country form an important part of travel motivation. Libraries are favorite
cultural institutions for the tourist. Most travelers like to learn the language of the country they visit.

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 • Science- tourists are interested to know the scientific activities of a country, especially those in technical industries, education, or
scientific research. Tourist promotion organizations would be rendering a great service to the scientific community by providing
facilities for the exchange of scientific, information, organizations of scientific installations and other activities, which provide
scientific information to visitors.
• Government- countries differ in their systems of government. Visits to centers of government, such as capitals, are very
motivating to individuals interested in political science and government. When a person visits another country, he becomes
aware of the type of government in operation and compares it with the government in his own country.
• Religion- religious pilgrimage is another motivation for travel. Most popular among the Muslims is the pilgrimage to Mecca.
Many people go to the different headquarters of their church organizations and to places that are well-known in their religious
literature.
• Food and Drink- food and drink of the country is an important part of the culture of a country. Tourists usually enjoy native
foods especially those which are local or ethnic in nature.
• History- historical resources of a country reveal its cultural heritage. The preservation of history and the quality and
management of museums are very important for the success of tourism. One of the weaknesses observed in historical museums
is that explanations of the exhibits are given in only one language.

TOPIC 4: THE TOURISM NETWORKS AND SUPPLY COMPONENTS

The travel industry is a tourism network, which includes both the public and private sectors.

Gee, Choy and Makens define the travel industry as “the composite of organizations, both private and public, that are involved in the
development, production, and marketing of products, and services to serve the needs of the travelers.” Which clearly identifies both the direct and
indirect components of the travel industry.

• Direct providers- includes businesses that are associated with travel, such as airlines, hotels, restaurants, ground transportation,
travel agencies, and retail shops.
• Support services- lends support to direct providers. It also includes basic supplies and services, such as contract laundry and
contract food services.
• Development organizations- different from the first two, since it includes planners, government agencies, financial institutions,
real estate developers and educational training institutions. These organizations deal with tourism development, which tend to be
more complex and broader in scope that the production of daily
travel services.

Tourism Supply Components:

1. Natural resources- a destination area provide an excellent asset to sell to tourists. Include elements in an area for the use and
enjoyment of visitors such as climate, landforms, terrain, flora, fauna, bodies if water, beaches, natural beauty and water supply for
drinking, and sanitation.
a. natural scenery- is a combination of the general topography, flora and fauna, proximity to lakes, river, seas, islands
and many more.
b. climate- the average course or condition of the weather at a place usually over a period of years as exhibited by
temperature, wind velocity and precipitation.

2. Infrastructure- consists of all underground and surface developmental construction of a region.

a. Water system- sufficient quantity of pure water is essential.

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 b. Power- important things to consider are that adequate supply of power be available to meet peak load requirements, that
continuity of service be assumed, and that the type of power supplied by compatible with that used by the target markets of
destinations.
c. Communication- is necessary that the telephone and or telegraph services available.
d. Sewage/drainage- water storage reservoir and sewage treatment plants can be designed on the basis of maximum average
demand; transmission lines must be designed on the basis of maximum peak demand.
e. Health care- health care facilities provided will depend on the number of visitors expected, their ages, the type of activities
in which they will engage, and local geographical factors.
f. Street/highways.
g. Transportation terminals (general, air, rail, bus)
h. Security
3. Hospitality Resources- includes the cultural wealth of an area which makes possible the successful hosting tourists. It is the way that
tourist services are delivered by service providers, as well as the general feeling of warmth from the local population.
4. Hospitality Training -aims to motivate service providers to be hospitable in dealing with tourist. It is assumed that providing more
hospitable services will result in a more satisfied tourist who will be inclined to return and advertise to other potential tourists through
word of mouth. To enable service providers to render hospitable services, it is necessary to change their present behavior.
a. Attitude toward self- it is a individual’s self esteem or attitude toward self is low, that individual will tend to behave in such
a way that the feedback from others will confirm the low opinion of himself. Hence, it is necessary to change the
individual’s perception of self in order to improve behavior.
b. Attitude toward others- service providers should be assisted in developing positive feelings toward fellow employees and
tourists that will result in positive behavior toward the tourist. This can be achieved by training the individual regarding
team work and interdependence in getting the job done. The key to development positive attitudes toward visitors is to be
able to develop the ability to put oneself in the visitor place.
c. Attitude toward the tourism industry- a positive attitude of service providers toward tourist can be brought about only when
employees are made aware of how important tourism is to their country, city or community. It is necessary to raise the level
of knowledge of the individual.
5. Transportation- is of paramount importance in developing tourism. Tourists need easy access to various forms of transportation.
a. Land travel
1. Taxi and Limousine services
2. Bus services
3. Rail services
b. Air travel- porter service is important at air terminals. Although airport facilities differ from place to place, the
comfort of travelers should always be kept in mind. Large airports provide comfortable and attractive waiting areas,
as well information regarding flight times and similar information.
c. Sea travel- is a major factor in tourism and hospitality. Cruise ships have developed into “floating resorts” or
“flotels”. The demand for sea travel has increased and cruise have become popular in recent years.
6. Superstructure
A. Accommodation- the demand for accommodations varies according to the price the guests are willing to pay, services required
and similar considerations. While away from home, tourist needs to eat and sleep.
Type of Accommodation
1. Hotels – provide accommodation, meals and refreshment. They provide facilities that meet the needs of modern
traveler.
2. Condominium- an apartment or individual dwelling unit.
3. Motels or motor hotels- provide bedroom, bath and parking to motorist. Usually near highways.
4. Inns- lodging establishment catering to transients which do not meet the requirements of an economy hotel.
5. Apartments- apartel, buildings, or edifices containing several independent and furnished or semi-furnished
apartments.
6. Paradores- old convents, monasteries, castles, fortresses converted into hotels by the government and operated
by a national tourism office.
7. Pensions- are private and family-operated tourist accommodations similar to boarding house or guest houses.
They offer food and lodging to tourists and are well known for their informal family atmosphere.
8. Bed and breakfast accommodation- provide a room, bath, and a hearty breakfast to tourists. They are known as
B&B’s.
9. Hostels- provide minimal amenities such as bunk beds and commonly shared toilet and bathrooms.
10. Camp grounds- appeal mostly to families who travel in recreational vehicle.
11. Health spas- hotel or resort which cater to individual who go to spas or mineral springs.
12. Private homes- provide lodging to tourist when accommodation are not available during peak seasons.
B. Hotel Classification- there are different ways classifying hotels. By location such as center city, suburban, airport, highway, and
resort. A more meaningful classification is one based on price such as economy or budget, standard or midscale, first-class or de
luxe. a star rating system is often used to classify hotels.
C. Food and beverage- more tourist spent on food and beverage than on any other services. The type of food service provided will
be related to the needs of the tourist. Many destination areas have successfully developed menus which are indigenous to the
area to promote local economy food.
D. Restaurants- establishments offering refreshments and or melas to the public.
END OF TOPIC FOR MIDTERM.
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References:
Cruz, Z. 2016. Principles of Tourism 1. Rex Book
Store, Inc. Philippines.
Cruz, Z. 2019. Micro Perspective of Tourism and
Hospitality. Rex Book Store, Inc. Philippines.
The economics of tourism P. 60-69
The sociology of tourism P. 70-79
Tourism and culture P. 81-93
The tourism networks and supply components P. 94-113

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