2024-12-182024-12-182023-02-21Hongru Zhang, Yang Yang, Is tourism growth able to shrink economic inequalities? A DSGE analysis, Annals of Tourism Research Empirical Insights, Volume 4, Issue 1, 2023, 100089, ISSN 2666-9579, https://doi.org/10.1016/j.annale.2023.100089.2666-9579http://hdl.handle.net/20.500.12613/10797The aim of this paper is to investigate the relationship between inbound tourism and economic inequalities (income and wealth). We construct a dynamic stochastic general equilibrium (DSGE) small open-economy model that includes the tourism industry and the housing market. We focus on the recent Icelandic tourism boom, and our simulation results suggest a reduction in income inequality and an increase in wealth inequality. Inbound tourism thus has opposite effects on domestic income inequality and wealth inequality, so the Icelandic government faces a trade-off when formulating tourism-related policies to reduce inequalities, and the consequences may depend on the type of inequality that policymakers prioritize. Lastly, implications are provided based on results.13 pagesengAttribution-NonCommercial-NoDerivs CC BY-NC-NDhttps://creativecommons.org/licenses/by-nc-nd/4.0/Inbound tourismIncome inequalityWealth inequalityDynamic stochastic general equilibrium (DSGE) modelingText