Does Sun-and-Sea All-Inclusive Tourism Contribute to Poverty Alleviation and/or Income Inequality Reduction? The Case of the Dominican Republic

Abstract

Tourism represents one of the most important industries in the world and one of the sectors of fastest growth. An understanding of the relation between tourism and poverty is key for poverty reduction in developing countries. The impact of tourism on the reduction of both poverty and inequality in income distribution is analyzed in this paper in the Dominican Republic (within the Caribbean Community of Small Island Developing States). The Ng and Perron test for analyzing time series stationarity and the AutoRegressive Distributed Lag bounds test were used to determine the existence of long-term relationships. The shortrun dynamic models represented by the Error Correction Models were also estimated. The results showed that income from tourism has not alleviated poverty and has clearly failed to reduce inequality in the distribution of wealth. Finally, management implications are also provided for public and private bodies wishing to achieve sustainable tourism.

Exploring the Tourism-Poverty Alleviation Nexus in the Brics Groupof Nations

“…Some studies (Blake, Arbache, Sinclair, & Teles, 2008;Llorca-Rodríguez, García-Fernández & Casas-Jurado, 2020;Njoya, & Seetaram, 2018) have found a positive relationship (tourism improves consumption per capita and hence, reduces poverty) between tourism and poverty alleviation. While, contrastingly other studies have found that tourism has an insignificant (Croes, 2014;Oviedo-García, González-Rodríguez & Vega-Vázquez, 2019;Rakotondramaro & Andriamasy, 2016) and in some cases a negative influence (Bolwell & Weinz, 2008;Croes & Rivera, 2015;Kim et al, 2016) on poverty alleviation. What is evident from the extent of the literature is that predicting the effect of tourism on poverty alleviation is very subjective and country specific (Mahadevan & Suardi, 2017;Zhao & Ritchie, 2007).…”

“…To a larger extent, preceding empirical studies related to the role of tourism in the alleviation of poverty have also been critiqued for being sporadic and lacking the sufficient depth to comprehensively interrogate the tourism-poverty alleviation nexus, thus contributing to the lack of consensus and the existence of gaps within the extent of the tourism literature (Mitchell & Ashley, 2010;Saayman, Rossouw & Krugell, 2012;Zhao & Xia, 2020). Moreso, the extent of the literature is critiqued for being 'insufficient', generalist and overly descriptive in analyses based on predominantly single locations (Davidson & Sahli, 2015;Oviedo-García et al, 2019). An extensive review of the literature from between 1999 and 2014 by Medina-Muñoz, Medina-Muñoz and Gutiérrez-Pérez (2016a), found that the empirical results of the various studies were contradictory as to the effect of tourism on poverty alleviation -and thus highlight the need for further empirical studies.…”

Exploring the Tourism-Poverty Alleviation Nexus in the Brics Groupof Nations

“…Some studies (Blake, Arbache, Sinclair, & Teles, 2008;Llorca-Rodríguez, García-Fernández & Casas-Jurado, 2020;Njoya, & Seetaram, 2018) have found a positive relationship (tourism improves consumption per capita and hence, reduces poverty) between tourism and poverty alleviation. While, contrastingly other studies have found that tourism has an insignificant (Croes, 2014;Oviedo-García, González-Rodríguez & Vega-Vázquez, 2019;Rakotondramaro & Andriamasy, 2016) and in some cases a negative influence (Bolwell & Weinz, 2008;Croes & Rivera, 2015;Kim et al, 2016) on poverty alleviation. What is evident from the extent of the literature is that predicting the effect of tourism on poverty alleviation is very subjective and country specific (Mahadevan & Suardi, 2017;Zhao & Ritchie, 2007).…”

“…Tourism is a highly integrative economic activity -contributing to the socioeconomic development of host economies through employment creation, tax base expansion, infrastructure and public resource development, as well as export earnings (Medina-Muñoz et al, 2016a). To this end, tourism is widely associated with the first of the United Nation's Sustainable Development Goals (SDG1) which advocates for the harnessing of socioeconomic mechanisms such as tourism (pro-poor tourism) as a vector for poverty alleviation (Mahadevan, Amir & Nugroho, 2017;Oviedo-García et al, 2019;Scheyvens & Hughes, 2019). Pro-poor tourism (PPT) may be characterised as an approach to tourism development and management where linkages are created between the tourism sector and the poor in order to alleviate poverty and mitigate its effects by changing the distribution of tourism benefits to include the poor (Chok et al, 2007;Strydom, Mangope & Henama, 2019).…”

“…To a larger extent, preceding empirical studies related to the role of tourism in the alleviation of poverty have also been critiqued for being sporadic and lacking the sufficient depth to comprehensively interrogate the tourism-poverty alleviation nexus, thus contributing to the lack of consensus and the existence of gaps within the extent of the tourism literature (Mitchell & Ashley, 2010;Saayman, Rossouw & Krugell, 2012;Zhao & Xia, 2020). Moreso, the extent of the literature is critiqued for being 'insufficient', generalist and overly descriptive in analyses based on predominantly single locations (Davidson & Sahli, 2015;Oviedo-García et al, 2019). An extensive review of the literature from between 1999 and 2014 by Medina-Muñoz, Medina-Muñoz and Gutiérrez-Pérez (2016a), found that the empirical results of the various studies were contradictory as to the effect of tourism on poverty alleviation -and thus highlight the need for further empirical studies.…”