Sunshine States in World Markets - The Political Economy of Tourism-Led Growth
In this joint research project with Donato Di Carlo (MPIfG and EUI), we explore the role of tourism-led growth in the EMU’s Southern periphery. From the early neo-corporatist literature to the varieties of capitalism and growth models scholarship, comparative political economy (CPE) has largely focused on manufacturing and, more recently, the finance sector. In so doing, however, CPE has neglected that within today’s predominantly services-based economies, the tourism sector has grown exponentially to become a full-fledged engine of economic growth and a source of employment creation. We aim to make three contributions to the ongoing debates on growth models. First, we demonstrate the remarkable economic importance of tourism for the Southern European countries and today’s economies more generally. By so doing, we aspire to bring tourism within political economists’ radar. Second, we unpack the dynamics of tourism’s growth and employment creation, classifying it as a specific type of export-led growth model. Third, through a detailed balance-of-payment analysis we show that this specific type of export-led growth based on tourism has been key to the macroeconomic adjustment of Southern Europe’s economies after the 2008 financial crisis. Thus, we argue that North/South financial flows linked to tourism have the potential to partially counteract the destabilizing tendency built into the design of an incomplete EMU. Yet, an increased specialization of Southern Europe toward tourism-led growth presents both promises and perils which should not be ignored.
Current Working Papers
- Market-Based Stabilization in the EMU: The Rise of Tourism-Led Growth in Europe’s Southern Periphery (with Donato Di Carlo)