Unpacking Your Suitcase: Insights and Tips for Smarter Travel

Who doesn’t love travelling? Travelling can be therapeutic for some or maybe a must for others. Due to the rapid increase in awareness, people have started to notice that tourism is not always rainbows and butterflies. Today's entry will uncover the hidden truths of tourism while giving you some tips and advice when you are planning your next trip. Some of the topics that will be dive in are:

● Uncertainty in travel insurance

● Tourist traps and how to avoid it

● The positive and negative impact of tourism

 Uncertainty in travel insurance

Before travelling, do you ever find yourself debating whether to spend an extra £10 on flight delay insurance? This is a classic economic decision, highlighting how we deal with uncertainty. Planes can be delayed for many reasons, presenting uncertainty, and a traveller's attitude towards this uncertainty is known as risk preference. Risk preference is divided into three types: risk-averse, risk-neutral, and risk-seeking.

People who are risk-averse don't like taking chances with unexpected events like flight delays, so they tend to buy travel insurance—even if it costs a bit extra. This helps them feel secure, knowing that if a delay does happen, the insurance will help manage the fallout and reduce their financial stress. On the other hand, risk-seeking or those who are less bothered by the possibility of a delay might skip the insurance. They usually think a flight delay is unlikely or just a minor hiccup, not worth the extra cost of insurance. So, they often opt out, saving money and betting on smooth travels. Individuals will typically display a risk-averse inclination when confronted with potential losses (Blake, Cannon, and Wright, 2021). Therefore, it might be wise to follow the common choice and opt for travel insurance. This straightforward decision can help manage uncertainties effectively, ensuring you are better prepared for any unexpected delays during your travels.

Tourist traps

Have you ever been to a tourist hotspot that’s not worth your money or felt like you're overpaying for a mediocre meal? Welcome to the world of tourist traps; a location that profits from attracting tourists, frequently by providing expensive or subpar goods and services. This problem often occurs due to the lack of information on the tourist side. How does it work? The classic example of this is when they advertise accommodations with lower prices that exclude hidden charges like taxes, cleaning fees or amenities fees. Tourists lured by these seemingly lower prices may book the accommodations without realising the hidden charges they’ll encounter. This will result in a feeling of being deceived or taken advantage of for the tourists.

Therefore, it is very important when travelling to do some background research on the destination that we are visiting so that we are well-informed of potential tourist traps. Look out for reviews and comments from fellow travellers regarding the goods or services that they provided. It is okay to be sceptical and be flexible for adjustments when travelling to make the most out of your money!

The positive and negative impact of tourism

After your travels, you would reflect on the memories you made but have you thought about how you affected the places you visited? Tourism not only promises sun-soaked beaches and unforgettable adventures but also serves as a lifeline for economies, particularly in places like the Maldives and the Bahamas. The influx of foreign dollars plays a crucial role in bolstering these nations' economic foundations. This cash flow facilitates the enhancement of local infrastructure—think improved roads, better healthcare facilities, and more robust public services. These improvements benefit both tourists and residents, significantly lifting the local standard of living.

The job market also gets a major boost from tourism. Hotels, restaurants, and local attractions provide numerous employment opportunities, often offering better pay and conditions compared to other sectors. This influx of jobs helps lower unemployment rates and stabilises the local economy by providing residents with steady income and career opportunities.

Moreover, tourism helps preserve cultural landmarks and natural resources. Revenue from tourism can be channelled into maintaining historical sites and protecting natural landscapes, ensuring they endure for both tourists and future generations of locals. This sustainable approach to tourism creates a virtuous cycle, where the benefits of increased economic activity are reinvested back into the community, further enriching the area and enhancing the lives of its residents.

While tourism is a source of economic development for some countries, it is vital to remember that it can be harmful to the local communities too. You may have noticed that in popular tourist locations, everything seems much more expensive than normal. This comes from tourists being more willing to pay premiums during their vacations. Take Hawaii, for instance, tourism has driven up the costs of living for the locals from housing to healthcare, making it the most expensive state in the US to live in, according to the Missouri Economic Research and Information Centre.

Although many of us may travel to appreciate the pristine beaches and the picturesque views of the natural world, our travels are significant contributors to the degradation of the environment. More than generating waste, the carbon emissions accumulated, especially from transportation, are a major result of this industry (Tang and Ge, 2018). If this continues to grow, there may not be any more nature to appreciate in the future.

These are only some of the negative impacts tourism has so when planning for your next vacation, be mindful of the impact made on the environment and the local communities.

Before you go…

As you can see, there are hidden economics to travelling and it is not just about relaxation and entertainment. So, before you book for your next vacation, you should do some research into the places you travel and consider some of the issues discussed. This will not only enrich your own travel experience, but it will also be beneficial to the communities you visit.

References

1. Blake, D., Cannon, E. & Wright, D. (2021). 'Quantifying loss aversion: evidence from a UK population survey', Journal of Risk and Uncertainty, 63(1), pp. 27-57.

2. Missouri Economic Research and Information Center (2023). Cost of Living Data Series Missouri Economic Research and Information Center. Available at: https://meric.mo.gov/data/cost-living-data-series. (Accessed: 6 April 2024)

3. Tang, M. and Ge, S. (2018). ‘Accounting for carbon emissions associated with tourism-related consumption’, Tourism Economics, 24(5), pp.510–525.