Tourism as a Development Trap

Countries leaning heavily on tourism rarely become rich; outside microstates, tourism-dependent places like Jamaica, Bali, Maldives, and Fiji remain poor despite global name recognition. Tourism is labor- and capital-intensive, hard to differentiate, and imposes negative externalities like overcrowding and talent flight. Rising tourism share is a red flag that the rest of the economy is failing to compete. — It pushes policymakers to prioritize tradable, productivity-raising sectors over reliance on tourist inflows that cap national prosperity.