Economic Forces And Effects Of Globalization In Tourism Industry Essay

Economic Forces And Effects Of Globalization In Tourism Industry - Essay Example The major factor in the tourism industry is the â€Å"tourist,† who by some is defined as a person, or people who travel, and stay in places outside their usual areas of residence for a period of more than twenty-four hours. The tourism industry comprises of the different types of facilities and services offered to tourists within a destination, or country for those â€Å"tourists.† For example, air transportation, hotels, and accommodation, restaurants, bars, cafes just to mention a few all of which are used in boosting the level of tourism within a country or destination. Therefore, the international tourism involves movements across borders for at least one stay in the foreign country for different purposes. These include business, leisure, visiting friends and relatives, international conferences, or seminars, and other purposes. This report deals with short-term movement of international tourists across borders for the reasons mentioned herein. The international to urism industry is worth an estimate of $856 billion in 2011, representing a growth of 1.7% per year over the past five years. However, the growth shadows a strong declined of 3.6% experienced in 2009 as the global economy succumbed to recession leading to a sharp fall in tourism in international tourism numbers.... This massive economic development resulting from tourism has both positive and negative consequences. Economic forces and effects of globalization play a significant role in shaping trends in the tourism industry. Economic forces refer to factors such as nature of the economic system in a country, demographic changes, employment, fiscal and monetary policies, rate of inflation, and interest rates which determines the state of the competitive environment in which a firm or industry operates. These factors affect the outcomes of a firm’s marketing activities, by determining the strength and volume of demand for its products and services. For example, increase in employment rates in a destination results into increased demand products and services. Globalization is the process of development toward an increasingly integrated global economy and characterized by free low of capital, free trade, and the tapping of cheap labor from foreign markets. Globalization also entails improvem ent of labor standards and practices resulting into quality services within the tourism and hospitality industry. With the ever increasing trend toward open and free economies, hospitality organizations such as Hilton Hotels has been able to gain from globalization that has created less trade regulations allowing the hotel to open and operate more chains globally. In addition, Hilton can acquire its supplies from all over the world without incurring more expenses resulting from trade barriers. Globalization has spread the materialistic culture common with the Westernized world and implementing values previously associated with the western culture. This has enabled the hotel chain to benefit economically from its chains established