Discussion Paper No.2401
Abstract :
This paper focuses on two major negative effects of over-tourism caused by excessive
tourists overwhelming the capacity of tourist spots. The first is traffic congestion, when a flood
of tourists shuts locals out of the public transport system. The second is environmental
pollution. Copious tourist trash negatively affects the natural environment and the
productivity of the environmentally sensitive agricultural industry. Applying the neoclassical
standard economic model, this paper theoretically investigates the economic effects of
countermeasures such as a tourism tax and expanding transportation capacity to show the
conditions under which those measures will be effective.
Keywords: Over-tourism, Tourism tax, Public transport, Tourist trash JEL Classification: Z30, R40