Tourism is a vital industry that contributes significantly to the global economy. However, the classification of tourism as either a visible or invisible trade is a matter of debate among economists and policymakers. In this article, we will delve into the characteristics of visible and invisible trades to determine where tourism fits within these classifications.
What are Visible and Invisible Trades?
Visible trades refer to activities or goods that can be physically seen and transported across borders. Examples include cars, machinery, textiles, and food products.
These goods are tangible and often require transportation via trucks, ships, or planes. Visible trades are easily measurable in terms of their value and quantity.
On the other hand, invisible trades refer to services that cannot be physically seen or touched but are still traded across international borders. Examples include financial services, telecommunications, software development, consulting services, and tourism. Unlike visible trades, these services do not require physical transportation but rely on technology and communication channels.
Tourism as an Invisible Trade
Tourism is often classified as an invisible trade due to its intangible nature. Tourists do not purchase physical goods but instead consume services such as accommodation, transportation, food and beverage, entertainment activities etc. These services are consumed locally but paid for by foreign visitors using foreign currency.
Furthermore, tourism relies heavily on communication technologies such as the internet and social media platforms to promote destinations and offer online booking facilities. This aspect of the industry further strengthens its case as an invisible trade.
The Debate
The classification of tourism as an invisible trade has been questioned by some economists who argue that it possesses both visible and invisible characteristics. For instance:
- Tourism involves the movement of people across borders which can be physically seen.
- Tourists purchase tangible goods such as souvenirs during their travels.
- The construction of tourism infrastructure such as hotels, airports, and theme parks involves physical materials and labor.
These tangible aspects of tourism suggest that it could be classified as a visible trade. However, the majority of tourism services are intangible and not easily measurable in terms of value or quantity. Thus, the industry remains classified as an invisible trade.
Conclusion
In conclusion, the classification of tourism as a visible or invisible trade is a complex issue. While there are visible aspects to tourism such as physical movement and tangible goods, the majority of the industry relies on intangible services and communication technologies. Therefore, it is safe to say that tourism is an invisible trade that plays a significant role in the global economy.