Page 245 - Contributed Paper Session (CPS) - Volume 4

CPS2218 Rusnani Hussin et al.
retail, food & beverage and lodging industries. Tourism Direct Gross Domestic
Product (TDGDP) recorded RM82.6 billion, grew 7.8 per cent from 2016 to
2017. The direct impact of the Tourism industry on GDP reflects the domestic
spending and government spending in the tourism industry. Hence, tourism
industry has direct impact and indirect impact to the economy
Objective of study is to measuring the economic impact of tourism
industry in Malaysia using InputOutput Analysis and to identify the direct and
indirect effect tourism industry to economic. This paper is divided into four
sections, including this one. Section 2 discusses the methodology that is
followed, while section 3 discusses the main findings for the economic impacts
of tourism industry. Finally, section 4 provides concluding remarks.

a. Literature review
Hanafiah, et. al (2013) defines that tourism development is a double-edged
sword for local communities and attitude directly affects the current and future
industry development. The involvement and participation of the community is
important towards the success of the tourism development plan. Hanafiah et.
al (201) found that Tioman Island community supported future tourism
development. It is clear that the role of local residence is vital to support
tourism development and maintain continuous growth.
Mazumder, (2013), defines that normal and ratio multipliers were
measured to demonstrate the contribution made by tourism industry and its
linkages with the other sectors of the economy. International tourist
expenditure generate output the most since output multiplier is seven times
higher than import multiplier. The value of import multiplier signals the
amount of leakage as a result from insignificant tourist expenditure. The
findings proves that tourism expenditure results in output generated and
higher value added. The multiplier analysis is found to be effective as an
appropriate policy making in regulating tourism industry.
However, multiplier analysis of tourism industry in Malaysia showed that
this industry is contributing significantly to the economy and proves as a
potential sector to enhance economic growth towards a developed nation by
2020.
Fletcher, 1994; Frechtling, 1999; Crompton & Shuster, 2001 and Tyrrell &
Johnston, (2001) agreed that until now the leading approach for economic
impact estimation of tourism is input-output analysis. They indicated that it
has long been recognised that tourism can have an impact on economic
activity. Most tourism related industries such as transportation, tax regulation
and special events would impact on the patterns of local economic activity
and overall economy.
Chou and Huang (2016) defines that, in particular, with the third phase of
the “opening up to Chinese tourism” policy implementation, the output value,

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