Tourism: sacred cow or silver bullet?
Date
2012-09-24
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Abstract
The overarching goal of this three-part dissertation was to measure the long-term outcome of a development strategy, in this case tourism. The first part serves to explain how tourism models are enacted and transformed. Using previously undiscovered archival data the myth of Cancún’s origins are unraveled revealing the pivotal role of relatively independent Mexico Central Bank, the use of credit laws and the importance of accrual accounting. The second part, also archival but combined with new archival techniques, cross-cuts revenue sources, expenditures, debt and social performance to better reveal outcomes. Combining by decades the above-mentioned themes, this longitudinal analysis from 1970 to 2010 demonstrates the ebbs and flows of government revenues from tourism as a function of three factors. First is the instability inherent in the industry due to seasonality, consumer tastes and crises both economic and physical (e.g. recessions, hurricanes and H1N1). Second, is a change in the tourism models from standard hotels in the 1970s and 1980s to a sharp rise in all-inclusive resorts and cruise ships since the mid-90s. Last but certainly not least, are federal taxes combined with local politics and lack of oversight that have fomented volatile public finance and excessive debt. The confluence of these three factors critically erodes tax compliance and reduces funding for social projects and environmental protection in a country where tax effort historically is one of the lowest of the OECD countries and one of the lowest in all of Latin America. The last part, and most controversial, is a conceptual and exploratory paper to demonstrate the importance of focusing on assets to ensure quality of life for current and future generations (sustainability). The measure of assets rather than flows (such as those monitored by National Economic Accounting and its touchstone metric Gross Domestic Product) ensures that the natural, social and economic capital on which our well-being depends also satisfies the minimum conditions for ecosystem resilience. However, this requires explaining why this is important and presenting a proposal to overcome current limitations. After an overview of the historical events behind today’s economic hegemony, GDP accounting and public sector accounting, I discuss the key accounting principles and especially the principles of relevance and reliability. With a focus on relevance, I assess current valuation methods and models, and then propose a public sector balance sheet with key asset and depletion metrics. Rather than a new or adjusted metric to arrive at a new or improved indicator, I propose a new approach to existing metrics and indicators: presenting the assets in a balance sheet for enhanced visibility, transparency and interdependency. I test my proposal using Cancún as a case to illustrate the use of metrics and demonstrate how a balance sheet highlights long-term assets with short-term flows as the handmaiden, not vice versa as is now the actuality. To summarize, this tri-partite analysis of actors and structures explicates the origins, practices and consequences of a development strategy. This study of the Cancún project is more than a historical correction, it offers a rare glimpse into field construction and the process of institutional change. Change requires a crucial catalyst that impels a change of orbit. Cancún was a decisive force that still conditions structures and economic development within Mexico.
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Citation
Ambrosie, L. (2012). Tourism: sacred cow or silver bullet? (Doctoral thesis, University of Calgary, Calgary, Canada). Retrieved from https://prism.ucalgary.ca. doi:10.11575/PRISM/28469