Economics & Tourism: Essay of application of the “steady state” concept in the analysis of the tourism flow. Jean-Louis Caccomo (Perpignan Via Domitia University – France)

The « Tourism Steady State » (T.S.S.) Economic growth and tourism activity The concept of steady state in the growth theory (Solow) The basic model The main equations : TA = G {KT ; H ; R} TA* = e at. e C Log TA* = a.t + C

International tourist arrivals

Tourism regions (WTO)

The T.S.S The trend of tourism activity Log TA* = at + C Log TA = a’t + C Log TA* Log TA C

Shock 1 : the level effect Illustration of the effect of a shock likely to brutally destroy a part of the tourism capital stock (KT), affecting the level of risk perception (R). Many examples may illustrated these effect as the tsunami in Asia, the bird flu in Thailand or Turkey, a terrorism attack in Egypt or in Bali, or the political disturbances in Syria. Log TA* = at + C Log TA* Log TA C T

Shock 2: the slope effect The second category of shock changes structural tourism attractivness itself. The following graph illustrates an increase of tourism attractivness: Log TA* = at + C Log TA* Log TA C T Change of structural TA Change of effective TA

Illustration: the Tsunami impact of Thailand TSS A combination between a level effect [1] and a slope effect [2] : Log TA* Log TA C T 1 2

Conclusion The TSS theory must enable us to evaluate the impact of various shocks (technological, natural, political…) on the tourism flow ; The TSS theory must enable us to measure the importance and the duration of the transition periods. The TSS theory constitutes the first step toward an economic theory of tourism attractiveness.