The economic sustainability of tourism growth through leakage calculation

The development and growth of tourism depend on its sustainability over time and on its benefits for destinations as a whole. However, calculating sustainability is not an easy task. This article focuses on the economic sustainability of tourism growth and, after an exhaustive review of the literature, proposes a quantitative mathematical model to measure it by analysing and calculating leakage in the hotel sector. Leakage analyses the amount of revenue generated by tourists that does not remain in the destination economy. Through a sample of 204 interviews with managers, this study validates the model created and calculates leakage in a mass tourism destination (the Valencian Region in Spain). The paper opens new areas of research in sustainability literature and will be of value to tourism planners and governments in their efforts to implement appropriate tourism development policies. Garrigós Simón, FJ.; Galdón Salvador, JL.; Gil Pechuán, I. (2015). The economic sustainability of tourism growth through leakage calculation. Tourism Economics. 21(4):721-739. doi:10.5367/te.2014.0372 Abelson, P. (2011). Evaluating Major Events and Avoiding the Mercantilist Fallacy*. Economic Papers: A journal of applied economics and policy, 30(1), 48-59. doi:10.1111/j.1759-3441.2011.00096.x Adams, P. D., & Parmenter, B. R. (1995). An applied general equilibrium analysis of the economic effects of tourism in a quite small, quite open economy. Applied Economics, 27(10), 985-994. doi:10.1080/00036849500000079 Archer, B. (1995). Importance of tourism for the economy of Bermuda. Annals of Tourism Research, 22(4), 918-930. doi:10.1016/0160-7383(95)00018-1 Archer, B., & Fletcher, J. (1996). The economic impact of tourism in the Seychelles. Annals of Tourism Research, 23(1), 32-47. doi:10.1016/0160-7383(95)00041-0 Arrow, K., Bolin, B., Costanza, R., Dasgupta, P., Folke, C., Holling, C. S., … Pimentel, D. (1995). Economic Growth, Carrying Capacity, and the Environment. Science, 268(5210), 520-521. doi:10.1126/science.268.5210.520 Asiedu, A. B. (2008). Participants’ characteristics and economic benefits of visiting friends and relatives (VFR) tourism - an international survey of the literature with implications for Ghana. International Journal of Tourism Research, 10(6), 609-621. doi:10.1002/jtr.698 Blake, A., & Sinclair, M. T. (2003). TOURISM CRISIS MANAGEMENT. Annals of Tourism Research, 30(4), 813-832. doi:10.1016/s0160-7383(03)00056-2 Blake, A., Arbache, J. S., Sinclair, M. T.,