Local Sustainable Development: The Case of Alghero

33 Pages Posted: 2 Oct 2008

See all articles by Isabel Cortés-Jiménez

Isabel Cortés-Jiménez

Nottingham University Business School

Manuela Pulina

University of Sassari - Faculty of Economics (DEIR) - CRENoS; Economic Research Centre North South (CRENOS)

Date Written: September 30, 2008

Abstract

The economy of the historical Catalan town of Alghero, situated in the North-West coast of Sardinia (Italy), is highly influenced by the trend and dynamics of tourism activity. However, the higher the number of tourists in a certain location the greater the costs associated with negative external effects that compromise the fragile environment and the quality of life of local residents. This paper analyses the current status, the evolution and future development of Alghero's tourism activity. To this aim three main empirical objectives are pursued. The first one is to build a historical picture of the evolution and dynamics of the tourism phenomenon in terms of demand and supply, outlining the seasonal and environmental related issues. As a second aim, a forecasting exercise is run in terms of prediction (or ex-post forecasting), a monthly frequency for the time span from January 1987 up to December 2007 is employed within an ARIMAX framework. Two separate ARIMAX models are estimated corresponding to the domestic tourism demand (Italian tourists) and to the international tourism demand (foreign tourists) since a preliminary investigation reveals notable distinct trend patterns. This first exercise will help us to understand the influence of the introduction of low-cost flights in 2000 in Alghero with an unstoppable path so far and particular patterns of inbound and domestic tourism in Alghero. The last aim of the investigation is to understand the temporal interrelationships existing between demand and supply. The question is whether tourist demand leads to tourist supply or demand is led by supply, or indeed these two components are contemporaneously determined. The outcome from this step of the analysis allows us to understand in which measure a fruition of non renewable and perishable resources is the basis for a long run sustainable path of growth. The empirical findings of the different parts of this paper provide an objective approach for a short and long run local policy. The local decision takers can understand in a structured manner whether an increase of the existing building capacity is feasible in a spatial, temporal and environmental perspective.

Keywords: Alghero, Tourism Demand and Tourism Supply, Forecasting, Local Policy

JEL Classification: R11, C5, L83

Suggested Citation

Cortés-Jiménez, Isabel and Pulina, Manuela, Local Sustainable Development: The Case of Alghero (September 30, 2008). Nottingham University Business School Research Paper No. 2008-02, Available at SSRN: https://ssrn.com/abstract=1275977 or http://dx.doi.org/10.2139/ssrn.1275977

Isabel Cortés-Jiménez (Contact Author)

Nottingham University Business School ( email )

Jubilee Campus
Wollaton Road
Nottingham, NG8 1BB
United Kingdom

Manuela Pulina

University of Sassari - Faculty of Economics (DEIR) - CRENoS ( email )

Via Torre Tonda
Sassari, SS 07100
Italy

Economic Research Centre North South (CRENOS) ( email )

Via Torre Tonda 34
Sassari
Italy

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