Multiplier effect
– A factor by which tourist spend is increased in this
process of re-spending
– The money spent directly by tourists is considered to
be the direct income received by a destination
– This spend goes to tourism business, e.g.
accommodation, meals, tours)
– These tourism business will then spend some of this
earned income obtaining goods and services from
their suppliers, e.g. staff wages
– This secondary spend of incomes is termed indirect
income
– Local residents spend their pay on daily live, this is
called induced income