Tourism Inter-Industry Linkages in the Lao PDR Economy: An Input—Output Analysis

Abstract

This paper studies the significance of economic linkages between the Lao PDR tourism sector and the rest of the economy. An international visitors' expenditure survey and input–output models were used to disaggregate tourism economic data from the economy. A series of approaches was then employed to construct inter-industry linkage measures. The results reveal a rising trend in tourism's linkages with the country's economy from 2003 to 2008, indicating an increase in the tourism sector's dependency on the rest of the economy. The key sectors are food and beverages, manufacturing, wholesale and retail trade, agriculture and livestock, and tourism – these sectors dominated the economy during 2003–2008. The results provide evidence that the Lao PDR tourism sector is a key sector in enhancing economic growth and enabling the country to be one of the fastest growing economies in the Greater Mekong Subregion.