Functional Planning Tool: Tourism Impact Model

The Tourism Impact Model (TIM) is an economic modeling technique that structures the existing relationship between tourism expenditures and various economic impacts. It provides a system of average impact multiplier linkages relating the tourism expenditures to some economic consequences. The model also considers the intermediate impact of capital investment induced by tourism activity. There are two basic types of equations comprising the TIM. One set is the various sectoral investment functions, which are estimated econometrically. The investment equations estimate the expected capital feedback resulting from current economic activity. The second set is current economic impact equations. The parameters of these latter equations are derived from the regional input-output model which determine the levels and the distributions of the various total economic resources required to satisfy a given final demand (expenditures) in the tourism sectors.