Tourist development and host-guest interaction: An economic exchange theory

Theoretical research on the impacts of tourism has a discernible bias towards residents' perceptions. To understand the evolution and dynamics of tourism, residents' perceptions have to be analyzed as part of an exchange process involving both residents and tourists. A conceptual framework of host-guest relations is required. This paper presents an economic model that builds on evidence that tourism involves the meeting of two populations. Their interactions and experiences influence their attitudes and opinions. This causes structural changes in individual preferences that affect residents' perceptions of tourism and tourists' willingness to pay. To interpret this process we use the Edgeworth Box, representing the “exchange” in terms of “resource-space” against income.