Tourism and Economic Development: Evidence from Mexico's Coastline

Benjamin Faber and Cecile Gaubert

American Economic Review, 2019, vol. 109, issue 6, 2245-93

Abstract: Tourism is a fast-growing services sector in developing countries. This paper combines a rich collection of Mexican microdata with a quantitative spatial equilibrium model and a new empirical strategy to study the long-term economic consequences of tourism both locally and in the aggregate. We find that tourism causes large and significant local economic gains relative to less touristic regions that are in part driven by significant positive spillovers on manufacturing. In the aggregate, however, these local spillovers are largely offset by reductions in agglomeration economies among less touristic regions, so that the national gains from trade in tourism are mainly driven by a classical market integration effect.

JEL-codes: L60 L83 O14 O18 R11 Z31 Z32 (search for similar items in EconPapers)
Date: 2019
Note: DOI: 10.1257/aer.20161434
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Citations: View citations in EconPapers (67)

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Working Paper: Tourism and Economic Development: Evidence from Mexico's Coastline (2016)
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