Tourism Contribution to Poverty Alleviation in Kenya: A Dynamic Computable General Equilibrium Analysis

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Abstract

The aim of this article is to investigate the claim that tourism development can be the engine for poverty reduction in Kenya using a dynamic, microsimulation computable general equilibrium model. The article improves on the common practice in the literature by using the more comprehensive Foster-Greer-Thorbecke (FGT) index to measure poverty instead of headcount ratios only. Simulations results from previous studies confirm that expansion of the tourism industry will benefit different sectors unevenly and will only marginally improve poverty headcount. This is mainly due to the contraction of the agricultural sector caused the appreciation of the real exchange rates. This article demonstrates that the effect on poverty gap and poverty severity is, nevertheless, significant for both rural and urban areas with higher impact in the urban areas. Tourism expansion enables poorer households to move closer to the poverty line. It is concluded that the tourism industry is pro-poor.
LanguageEnglish
Number of pages12
JournalJournal of Travel Research
DOIs
Publication statusPublished - 4 Apr 2017

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computable general equilibrium analysis
poverty alleviation
Kenya
poverty
tourism
Tourism
Industry
Engines
urban area
real exchange rate
industry
agricultural sector
tourism development
equilibrium model
contraction
General equilibrium analysis
Computable general equilibrium
Poverty alleviation
Poverty
rural area

Cite this

@article{73cb3286cb3b4da7bbd684fd1330cb12,
title = "Tourism Contribution to Poverty Alleviation in Kenya: A Dynamic Computable General Equilibrium Analysis",
abstract = "The aim of this article is to investigate the claim that tourism development can be the engine for poverty reduction in Kenya using a dynamic, microsimulation computable general equilibrium model. The article improves on the common practice in the literature by using the more comprehensive Foster-Greer-Thorbecke (FGT) index to measure poverty instead of headcount ratios only. Simulations results from previous studies confirm that expansion of the tourism industry will benefit different sectors unevenly and will only marginally improve poverty headcount. This is mainly due to the contraction of the agricultural sector caused the appreciation of the real exchange rates. This article demonstrates that the effect on poverty gap and poverty severity is, nevertheless, significant for both rural and urban areas with higher impact in the urban areas. Tourism expansion enables poorer households to move closer to the poverty line. It is concluded that the tourism industry is pro-poor.",
keywords = "Kenya, tourism development, poverty, dynamic computable general equilibrium, CGE, microsimulation, Foster-Greer-Thorbecke Index",
author = "{Tchouamou Njoya}, Eric and Neelu Seetaram",
year = "2017",
month = "4",
day = "4",
doi = "10.1177/0047287517700317",
language = "English",
journal = "Journal of Travel Research",
issn = "0047-2875",
publisher = "SAGE Publications Ltd",

}

TY - JOUR

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T2 - Journal of Travel Research

AU - Tchouamou Njoya, Eric

AU - Seetaram, Neelu

PY - 2017/4/4

Y1 - 2017/4/4

N2 - The aim of this article is to investigate the claim that tourism development can be the engine for poverty reduction in Kenya using a dynamic, microsimulation computable general equilibrium model. The article improves on the common practice in the literature by using the more comprehensive Foster-Greer-Thorbecke (FGT) index to measure poverty instead of headcount ratios only. Simulations results from previous studies confirm that expansion of the tourism industry will benefit different sectors unevenly and will only marginally improve poverty headcount. This is mainly due to the contraction of the agricultural sector caused the appreciation of the real exchange rates. This article demonstrates that the effect on poverty gap and poverty severity is, nevertheless, significant for both rural and urban areas with higher impact in the urban areas. Tourism expansion enables poorer households to move closer to the poverty line. It is concluded that the tourism industry is pro-poor.

AB - The aim of this article is to investigate the claim that tourism development can be the engine for poverty reduction in Kenya using a dynamic, microsimulation computable general equilibrium model. The article improves on the common practice in the literature by using the more comprehensive Foster-Greer-Thorbecke (FGT) index to measure poverty instead of headcount ratios only. Simulations results from previous studies confirm that expansion of the tourism industry will benefit different sectors unevenly and will only marginally improve poverty headcount. This is mainly due to the contraction of the agricultural sector caused the appreciation of the real exchange rates. This article demonstrates that the effect on poverty gap and poverty severity is, nevertheless, significant for both rural and urban areas with higher impact in the urban areas. Tourism expansion enables poorer households to move closer to the poverty line. It is concluded that the tourism industry is pro-poor.

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KW - tourism development

KW - poverty

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KW - CGE

KW - microsimulation

KW - Foster-Greer-Thorbecke Index

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DO - 10.1177/0047287517700317

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