TOURISM AND ITS MULTIPLIER EFFECTS

PRESENTED BY

NIDHU K NS RAJPRIYA

INTRODUCTIONMultiplier effect refer to an economic concept. Within the context of tourism multiplier effect are those economic impacts brought about by a change in the level or pattern of tourism, when a destination is sold to a customer or customer group, every one who is providing some service in relation to tourism gets benefited.Tourism sector and its multiplier effects contributes to the economic growth.

MULTIPLIER EFFECTThe term 'multiplier' is derived from the fact that the value of expenditure is multiplied by some estimated factor in order to determine the total economic impact.

MULTIPLIER EFFECT

TOURISM AND IT’S MULTIPLIER EFFECT TOURISM

Tourism is travel for recreational, leisure or business purposes.

Tourism is a booming service sector industry which brings income to the nation.

The tourism sector have bought tremendous changes, it contributes to the overall development of the economy.

MULTIPLIER EFFECT IN CONTEXT OF TOURISM Tourism sector extends its growth to the overall

growth of the economy. In tourism multiplier effects are those economic

impacts brought about by a change in the level or pattern of tourism expenditure.

MULTIPLIER EFFECT OF TOURISM

TOURISM

HOTELS

TRANSPORTATION

SHOPPING CENTERS

ARTISANSHOSPITAL

TOURIST GUIDES

FINANCIAL SERVICE

FARMERS

Multiplier effect of tourism on economy

Direct effectIt occur at front-line tourism-related establishments. When tourists spend their money in hotels, restaurants, transportation and communication services and retail outlets

Indirect Effect Subsequent effects as a result of the direct economic effects. For instance, when the tourist spends money in a restaurant, the restaurant will spend some of the money it receives on food and beverage supplies, some of it on transport, heating and lighting, accountancy and other business services, and so on.

MULTPLIER EFFECT ON ECONOMYExpenditure multiplier 1.Spending on goods and services by tourists

2. Investment by external sources

3.Government spending

4.Spending on infrastructure

5.Exports of goods stimulated by tourism.

Income multiplier 1.The ration method, which expresses the direct and indirect incomes

generated per unit of direct income.

2. Normal method, which expresses total income (direct and secondary) generated in the study area per unit increase in final demand created within a particular sector.

Economic multiplier combination of direct and secondary employment generated

Tourism development and benefited areasTourism promotes the development of the following sectorsHotelsTransportationHospital and health care centersFarmersArtisansTourist GuidesShopping centersFinancial Service

For instance when tourism expands in an area the hotels are directly benefited and it in turn it benefits the other sectors

New mode of tourism and its multiplier effectMedical TourismFarm TourismEco TourismEducational TourismCreative Tourism

Medical TourismWhen there is a significant price difference between

countries for a given medical procedure traveling to take advantage of regulatory differences is referred to as "medical tourism".

Ayurveda “the soul of Indian medicine” attracts foreigners to India

FARM TOURISM

“Bring you the best rural experience in India” the slogan of Indian farm tourism. Kerala is a well known example for the promotion of farm tourism.Tourists are attracted by the traditional agricultural practice of courtiers.

Eco Tourism

Ecotourism, also known as ecological tourism. It helps educate the traveler. provides funds for conservation.directly benefits the economic development and political empowerment of local communities.

Educational Tourism

Developed, because of the growing popularity of teaching and learning of knowledge. This promotes educational sector as well as tourism of the area as the students become a tourist for the place

Creative TourismA tourism related to the active participation of travelers in the culture of the host community, through interactive workshops and informal learning experiences.

This helps in the promotion of traditional products

Multiplier effect of tourism in the paradise of Kerala-

WAYANAD

WAYANAD

Wayanad, One of the fourteen districts in Kerala (India) is situated in an elevated picturesque mountainous plateau in Western Ghats. Wayanad - the green paradise - the border world of greener part of Kerala. With emergence of tourism there has been notable change in Wayanad now tourism and its multiplier effects are the main source of income.

Tourism in Wayanad

Major tourist places in Wayanad Edakkal CavesPookot LakeBanasura DamKuruva IslandMeenmotty Water fallsSoochipara water fallaChembra PeekMuthanga Wild life sanctuaryKarapoozha DamView pointAmbalavayal FarmPazhasi TombChain Tree

Tourism development in Wayanad Types of tourism 1. Recreational tourism 2. Adventurous tourism 3. Historic tourism 4. Pilgrim tourism 5. Farm tourism

New developments in infrastructure 1.Development in resorts and hotels 2.Tribal development 3.Transportional development 4 .Handicraft development

Multiplier effect of tourism in WayanadDirect impact Income generates through sale of entry tickets/boating tickets at various tourist centers like pookot lake, edakkal caves, kuruva island,soochipara water falls , banasura  dam etcHotel/resort/home stay/tree house etc generates income from thesalerooms/dormitory/food. Tour operators/ travel agents generates income from the sale of train ticket/ plane ticket/package tour etc.Car owners/bus owners earns income from car rental/bus rental.Grocery shop income generate from the sale of grocery items to tourists. Handicrafts shop income generate from the sale of handicraft items

Indirect EffectIncrease in salary to tourist center staff/hotel/resort/home stay staff etc. Wages to drivers/wages to shop staffs.

Induced effects

Farmer gets income from the sale of rice/vegetables to hotel/ resort that make foods for the tourists.      

Tourism Statistics in Wayanad during the past years

Comparison of tourism in Wayanad during 2007-2008

Foreign Tourist arrival to Wayanad during the year 2008 is 5,638 It shows an increase of 37.5% over the previous year. Domestic Tourist arrival to Wayanad during the year 2008 is 295,465. It shows an increase of 14.28 % over the previous year. Considering the district wise Foreign Tourist arrival in Kerala, Wayanad district shows the highest variation of 37.75% over 2007. Considering the taluk wise Domestic Tourist arrival, Manathavady shows the highest variation over 2007.

FOREIGN DOMESTIC0

5

10

15

20

25

30

35

2007

2008

2010

TOURISM DURING 2007-2010

INCOME FROM TOURISM IN WAYANAD FROM 2004-2010

Year Pookot lake Edakkal Caves Heritage Museum

2004-05 2538597 376668 115995

2005-06 2987703 638837 117745

2006-07 3943054 1221229 152615

2007-08 4230600 1877700 265750

2008-09 6050775 2456550 270059

2009-10 5799920 3122525 416769

TOTAL NO OF VISITERS IN WAYANAD DURING 2004-2010

Year Pookot lake Edakkal Caves Heritage Museum

2004-05 280584 68751 23500

2005-06 301215 79333 26549

2006-07 334529 102125 30523

2007-08 423068 179763 25579

2008-09 344543 249822 29825

2009-10 423668 311246 43634

CONCLUSION

In this era of excellence man is at the top point of achievements. And he has also made it possible that the development of one industry will contribute to the development of other directly and indirectly related sectors. Multiplier effect of tourism, contributes a lot in the overall development of the economy and it helps to benefit the all the related sectors.