Tourism as an instrument of economic growth: Empirical exploration at the regional level in Spain

Abstract

This work analyzes the dynamic relationship existing between tourism and economic growth through the use of different indicators to measure tourism activity, according to regional data from Spain taken from 2004 to 2021 that are linked to the NUTS-2 level of the nomenclature of the territorial units for statistics of the European Union. This is an innovative approach as compared to the majority of existing works analyzing this relationship at a country level. However, it is widely recognized that the contribution of tourism to growth takes place in the form of regional development. By introducing the notion of distance between the dynamic trajectories of the different regions, an analysis of hierarchical clusters was performed, enabling the identification of regional groups having similar behavior in terms of tourism performance and economic growth. In this work, it has been established that the impact of a region's total (national and international) tourism, in terms of both number of tourists and tourism expenditure, is the most appropriate indicator for tourism analysis at a regional level. Furthermore, it identifies the characteristics that are found in tourist regions having a higher level of economic growth, from a tourism perspective: high tourist spending, hotel accommodation, motivation for leisure, longer average stay, the region's orientation towards the tourism industry, and, mainly, the impact of international tourism. Therefore, those responsible for tourism destination management should implement policies that favor the arrival of tourist flows with these characteristics if they intend to promote tourism as an instrument for greater economic growth.