Sustainable tourism, market failures and the challenge of neo-liberal market economies.

Transcription

1 THINK TANK XIV POLITICS, POLICY AND GOVERNANCE IN SUSTAINABLE TOURISM Sustainable tourism, market failures and the challenge of neo-liberal market economies. PROFESSOR DAVID G SIMMONS LINCOLN UNIVERSITY NEW ZEALAND

2 An Agenda : a thought piece Governance Tourism governance and management The pervasive challenge of market failures / externalities Policy tools Economic thought, human behaviour, social welfare; the emergence of neo -liberalism Sustainable Tourism in a neo-liberal political economic ideology.

3 Governance Governance refers to "all processes of governing, whether undertaken by a government, market or network, whether over a family, tribe, formal or informal organization or territory and whether through power, laws, norms or language." It relates to processes and decisions that seek to define actions, grant power and verify performance.

4 Governance in practice Through top-down methods that primarily involve governments and the state bureaucracy. Through the use of market mechanisms whereby market principles of competition serve to allocate resources while operating under government regulation; Through networks involving collaboration of community organisation or via public - private partnerships (PPP);

5 The Basic roles of Government 1. Protecting society from, violence by other societies (national defence) 2. Protecting society members from injustice and oppression by others and administrating justice (policing and judicial systems) 3. Assigning human and property rights, and where not possible distributing and re-distributing resources (land allocations, quotas (fishing), licences (concessions)) 4. Improving human welfare, usually through enabling development; providing those goods and services where the market or private does not find worthwhile to provide. These are commonly known as public goods (examples include: education, health, social welfare) Drawn from Adam Smith, Randall (1987) and Inman (1987)

6 The specific challenges of tourism governance Does tourism generate market failures in either production or consumption? Market failures occur when there are unpriced input or unpriced outputs (ie the market fails to price /include) in activities. These are commonly called externalities

7 Tourism : negative externalities ie Unpriced Costs Some consider the tourism product (destination experience) exists outside of (external to) the industry Scenery : overcrowding Landscapes : natural environments : envt damage Culture hospitality : cultural change

8 Tourism : merit goods ie Un(der)priced Benefits Goods or services that would be underprovided if left to market forces or private providers (ie production is not socially optimal) {health, education, defence, } Tourism promotion Tourism data / research Museums, galleries, parks Associated issue : free riders and /or collective action problems

9 Government actions.. The suite of goods and service (amenities) where government involvement can be indicated is identified by the characteristics of the goods and services in consumption. What is appropriate involvement is in turn shaped by beliefs (theories?) about human behaviour (economic rationality), economic theory, and how they inform political ideologies.

10 Typology of goods & services Typology of goods Rival Consumption of a good prevents simultaneous consumption by others Some goods are rival when there is adequate supply /lack of congestion Partly non-rival Excludable Can any one consumer be excluded from use once provided (pricing) private goods food, drink, souvenirs Within four walls Restaurants Stadia Non-excludable Difficult to price, ration, or exclude congestible goods Crowding Non-rival Consumption of good does not exclude (parallel) consumption by others club goods Collective Goods public goods Foundation elements, infrastructure

11 A TYPOLOGY OF TOURISM RELATED GOODS Rival Congestible (Partially Non-rival) Nonrival Excludable private good Tourism experience Souvenirs Food drink Bridges Roads Goods within 4 walls Theatres Stadia Restaurants Hotels Motels Some recreation Facilities (theme park) Nonexcludable Natural & environmental amenities Scenic viewpoints Tramping trails National parks Public beaches Lakes Some public recreation leisure facilities 1. public good Place produce Consumer information Demand information Natural & socio-cultural foundation tourism elements 2. local public goods 3. group goods Common interest goods Collective goods

12 Framework (public choice theory) Evaluating the Government involvement in provision of goods and services Characteristics Goods / services Tourist destination (ocean, cultural displace); facilitating tourism flows Rivel Excl Negative External ity Collective Action Problem Benefits Approp by Producer Central Govt Role NR NE * * Direct provision, or measures to assure supply and quality National Destination Promotion NR NE * Direct provision, or measures to assure supply and quality Local Destination Promotion NR NE * */- Possible govt assistance to overcome CAP Local Public Goods (parks, roads, infrastructure) NR NE * * * Local or sub-central govt provision Individual Product Promotion NR NE * Private Provision Natural Assets (Icon NPs, WHA sites) C E * * Govt measures to preserve protect quality and supply within four walls (hotels, theatre, stadia) manufactured assets (Theme Parks, Club Med) Natural, environmental & fabricated amenities (fishing sites, public squares, historic monuments) C E */- * Private provision. Govt measures to mitigate externalities as necessary C NE * * Govt measures to preserve protect quality and supply Some personal goods eg souvenirs R E */- * Private provision Tourism experience R E * * Private Provisions. Mitigate externality and protect envt After : O Fallon 1992: 123 Public goods Club goods Congestible Goods Private Goods

13 Appropriate investment for tourism governments Socially defined Economically informed Politically enabled

14 Political economics Keynesian welfarism The state is a necessary investor to balance and regulate ( steer ) the economy Markets have no social conscience But governments can fail and be captured Neo - liberalism Man is a self optimiser and the market is the purest form by which to seeking efficiency Competition is the key driver to economic progress Use of networks beyond the state, as well as markets (and quasi markets) But markets fail and policy can be captured

15 Contemporary Application to Tourism government as an essential partner (Dredge) While role of government is also to moderate the activities and reach of the private sector (Shone) Government increasingly seen as an operator

16 Government roles Actively contested within administrations and at times within departments Enablement Management

17 What of Sustainable Tourism? Participation as a cornerstone while increased tensions between representative vs participatory democracy. Short term vs long term thinking finding environmental balance Common property as inputs (debate of how much resource access /allocation) : alongside policy spin : conservation economy finding balance (Hall 2010) economic growth is the primary concern Scale.. federal, regional, local

18 A question? Given the particular characteristics of tourism in production and consumption why is tourism not a leading voice in the critique of neoliberal policies?

19 Is their an evidence / science frontier? Political science (Richter 1991 JoST ) Political economics Policy analysis Economics (variants of) Ecological economics Environmental accounting Eco-system services

20 Evaluations /critiques of resource allocation instruments Compulsory /Regulatory Voluntary Public Sector Laws Taxes Regulations Resource consents Advocacy Joint Ventures (club formation) Private Sector Consent standards (water extraction /discharge states) environmental /benchmarking certification Voluntary codes of conduct Clubbing Collective action solutions : you must do x to belong to get group benefits (but joining is not compulsory

21 The question? Given the particular characteristics of tourism in production and consumption why is tourism not a leading voice in the critique of neoliberal policies? Thank you for your attention Questions Comments Professor David G Simmons David.Simmons@lincoln.ac.nz

22 Thank you for your attention Questions Comments! Professor David G Simmons David.Simmons@lincoln.ac.nz