Modeling the impacts of hospitality and tourism enterprises on community quality of life

Sangchoul Yi, Purdue University


The present research examined the impacts of hospitality and tourism businesses on community quality of life using existing public domain databases. In the tourism literature, various methodological approaches have been proposed to investigate the impacts of tourism on a host community and its residents. However, these approaches are limited because of innate methodological constraints such as the bias of the survey respondents' perceptions. To overcome such a limitation, alternative research constructs have been proposed. Among them, Quality of Life (QOL) has become a good alternative for measuring tourism impacts. Accordingly, the present researcher introduced QOL as a research tool for analyzing tourism impacts at the community level. Based on tourism impact theories and quality of life theories, the present researcher conceptualized a tourism-related QOL, constructing QOL indices and analyzing the impacts of hospitality and tourism on community quality of life. To construct QOL indices, ten objective and perception-based QOL indicators were utilized. After conducting a Principal Component Analysis (PCA) on QOL indicators, five QOL domains were identified: material QOL, social QOL1 (i.e. overall social QOL), social QOL2 (i.e. subjective social QOL), social QOL3 (i.e. safety-related QOL), and environmental QOL domain. To estimate a tourism impact model, 775 American counties were selected as sample counties, and five statistical models were proposed. According to model diagnostic test results, it turned out that the Seemingly Unrelated Regression Model (SURE) with Maximum Likelihood estimation (ML) is the most suitable estimation method because it overcomes the common obstacles of simultaneous estimation models. The results of the SURE model indicated that the sub-domains of community QOL are interrelated, showing that such interrelationships should be considered when the parameters are estimated. The major findings are as follows: 1) the hospitality and tourism industry positively affects material QOL, 2) overall social QOL is positively affected by the hospitality and tourism industry, 3) the hospitality and tourism industry does not affect subjective social QOL, 4) the hospitality and tourism industry affects safety-related QOL in mixed ways, 5) the tourism industry positively affects environmental QOL, 6) natural factors are a significant determinant of environmental QOL, and 7) community characteristics affect community QOL. Research results suggest crucial implications for rural and coastal communities. For example, rural communities have suffered from a low level of community QOL. However, tourism can improve material and social QOL, alleviating such a disadvantage for rural areas and implying that the tourism industry could be a strategic industry for rural areas to improve community QOL. Practically, the present research demonstrated how to simulate tourism impacts using estimation results of the research model. In simulation, three different scenarios of tourism development were used, clarifying that rural counties in coastal and non-coastal areas can benefit from tourism development. Especially, when policy makers and tourism practitioners want to know expected consequences of tourism development on their communities, simulation results would provide straightforward information about tourism impacts. The present research contributed to tourism academia and local communities in three ways. Theoretically, the present research reconciled tourism impact theory and QOL theory in a community QOL framework. It suggested a new way to examine tourism impacts on local communities. Previous research investigated tourism-related QOL from the QOL research framework, attempting to analyze tourism phenomena using QOL theories. However, the present research proposed that it is easier to understand tourism phenomena after reconciling tourism and QOL theories. Methodologically, the present research demonstrated how to build community-level QOL indices in a systematic way using public domains data sets. The researcher also showed how to use an equation system for estimating multidimensional impacts of tourism on community QOL domains. Such an approach is an innovative way to investigate tourism impacts on local communities; the present research is the first to consider multidimensional aspects simultaneously and to reconcile objective and subjective indicators of QOL research at the community level. Practically, one of the research outputs is a community-level QOL database. It should be helpful when policy makers and community leaders consider tourism as a community economic development tool and evaluate tourism impacts on their communities. The database is also a basis for simulation of QOL changes by tourism development, providing information about potential consequences of tourism development. This is one of the main contributions of the present research.




Day, Purdue University.

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