Abstract. Differences in property tax rates among communities within a regional economy are a source of inefficiency and inequity. Less developed rural areas where natural amenities exist have often attempted to use the tourist industry as a means of importing economic development. Promoters of vacation home development argue that the impact on the local tax base is positive. However, the quantitative research in this paper indicates that under certain circumstances, vacation home development has the effect of increasing the tax burden on residential property.
This research follows the dynamics of the leisure “service” production cycle of a tourism site through the nonlinear technique of system dynamics. System dynamic models use feedback relationships to interrelate observed data and descriptive information to understand the internal linkages among the competing forces of a system. The resulting simulation provides a long run forecast that can be used by policy makers in achieving a balanced strategic management plan. As with all system dynamics models, the purpose is to develop a quantitative simulation that depicts the structural relationships of the process under study. Public and private decision makers are concerned with the long run results of regional tourism site development This research criticizes the current use of the product life cycle concept as applied in the market for services for its inability to consider the structural dynamics of the market. The structural dynamics are considered in the formal model developed here. The goal of this research is to provide insight into the use of system dynamics models as a tool for aiding in strategic decisions concerning regional tourism site development.
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