Negative Economic Aspects of Tourism and Hospitality

Inflation and Land Values- Growth in the tourist trade creates additional demand for land and
competition from potential buyers increases the price of land. The demand for more hotels,
vacation homes, and tourist facilities may bring more income to builders, real estate agents, and
landowners, but local residents are forced to pay more for their homes because of the increased
value of land.

High Leakage- occurs from variety of sources. It occurs from the cost of goods and services that
must be imported to satisfy the needs of tourist, the remittance of profits and wages to outside
sources that reduces profits in the destination country and the expenditure for promotion and
publicity to encourage tourists to visit a certain destination.

Seasonality- Many tourist regions experience low returns on investment because of seasonal
fluctuations in demand. The seasonality of demand is reflected in hotel occupancy rates. Many
hotels experience greatly reduced revenues during the off season.

Overdependence on Tourism and Hospitality- some destinations have made themselves

vulnerable to changes in tourist demand by becoming over dependent on tourism and hospitality
for their livelihood.

B. Social impacts of tourism and hospitality

Aims and learning outcomes that student can:

1. Discuss the social impacts of tourism and hospitality. The social impacts of tourism and
hospitality refers to the changes in the quality of life of residents of tourist destination.
The objective of social tourism is to ensure that tourism is accessible to all people
● Host-visitor Interaction- tourism and hospitality causes more interaction between
people particularly between the tourist or visitors, and the local residents or host.
Smith (1997) categorized tourist into several types and outlined her views on the
intensity of interaction between the tourist or visitors and the local residents
(host) Her classification are as follows:
1. Explorer- This type of visitor is interested in being an active
participant - observer among the population the explorer easily
adapts to local lifestyle and does not need special tourist
accomodations
2. Elite- He can afford to pay well for unusual vacation. He is well
travelled and usually known as "The jet settee"
3. Unusual Tourist - This tourist loves sub-exotic cultural sites and
the unusual or primitive sites as long as he can quickly and safely
return to more familiar surroundings and group
4. Incipient Mass Tourist- this is the visitor who looks for the
amenities of western societies in hotels and other travel-related
 facilities. He is a mixture of both pleasure seeker and business
traveler;
5. Mass Tourist- he comes from the middle class. He arrives in the
destination with other tourists. There is a diversity of taste among
them and their attitude is "you get what you pay" and
6. Character Tourist- the character tourist comes "en masse" with
others of his kind creating an extremely high amount of business
and receiving a high degree of standardization in services and
products.
● Positive social effects of Tourism and Hospitality

1. It creates new medium for social change and multicultural understanding.

2. It encourage adaptation to the realities of modern life and works towards
improving the host countrys environment and lifestyle options.
3. It improves knowledge and use of foreign language and
4. It improves health condition and disease control
● Negative social effects of Tourism and Hospitality

1. Social saturation- the presence of large numbers of tourist in particular places at

specific time result in saturation or congestion of facilities and services and
competition for limited resources. The local residents frequently resent having to
share their facilities and services with visitors.
2. Changes in the Social structure, behaviors, and roles- Tourism and hospitality
changes the traditional forms of employment which results in the lowering of the
status of agricultural workers migration of the population, and the breaking up of
families
3. Community problems - prostitution, often called the "oldest profession" certainly
existed before the growth of mass tourism and an increase in an visitor increase
criminal activity.
4. Negative Demonstrative Effect- consist of tourist behavior which can be
considered socially and economically inappropriate. One of the major results of
negative demonstrative effect is the polarization of the host from the tourist which
happens in a number of ways. First tourist often demand commodities and
facilities beyond the economic capacity of local residents. Second the social
norms of tourists that are very different from the local customs give rise to social
problems and the third factor is the importation of foreign workers from more
developed countries.