Journal Article

EMPIRICAL ESTIMATION OF THE POTENTIAL ECONOMIC IMPACT OF TOURISM PROMOTION POLICY IN ALGERIA

Zerkaka, Sabrina, Souman, Mohand Ouidir

2024

Overview

Objective: The objective of this paper is to empirically assess the economic impact of tourism promotion policies in Algeria. By utilizing an economic model based on the 2021 Social Accounting Matrix (SAM) multipliers, the study aims to quantify the direct, indirect, and induced effects of increased tourism demand on various sectors of the national economy. Specifically, the research seeks to evaluate how tourism expenditure influences production, sectoral output, and income distribution, while also identifying which sectors and economic agents benefit the most from tourism growth.   Theoretical Framework: Study is based on the Social Accounting Matrix (SAM) approach, which examines the interconnections between sectors of the economy and tracks the flow of income and expenditure. It incorporates input-output theory to measure the direct, indirect, and induced effects of increased tourism demand. The concept of economic multipliers is central, highlighting how tourism spending influences various sectors. Additionally, the framework assesses the distribution of benefits across different economic agents, focusing on how tourism impacts production, sectoral output, and income distribution in Algeria.   Method: This study uses 2021 Social Accounting Matrix (SAM) data to analyze tourism demand in Algeria. It develops an economic model, simulates scenarios, and assesses the economic gains and distribution of benefits, providing a comprehensive evaluation.   Results and Discussion: The SAM-based economic model shows that Algeria's tourism demand boosts production and output across sectors, particularly agriculture, hospitality, agri-food, construction, transportation, and energy. However, the benefits are not evenly distributed, potentially leading to income inequality. Policy interventions should focus on equitable income distribution and supporting key industries.   Research Implications: Tourism can drive Algeria's economic diversification, reducing dependence on traditional sectors. Inclusive tourism policies are needed to ensure equitable benefits for wage earners and lower-income groups. Future research should focus on sector investment and employment effects.   Originality/Value: This study analyzes the economic impacts of tourism promotion policies in Algeria, focusing on the 2021 Social Accounting Matrix. It provides insights into the distribution of benefits and emphasizes the need for inclusive policies. The findings provide actionable insights for policy development.

• Subject: Algeria / Potential Effects / SAM Multiplier Model / Tourism Promotion Policies