Explain how a country's economic policy influences the success of the tourism industry.  

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pohnpei397 | College Teacher | (Level 3) Distinguished Educator

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There are a number of ways in which economic policy could influence the success of the tourism industry.

First, there are ways that economic policies a government takes can have a direct impact on tourism.  This type of impact would occur when a government makes policies explicitly aimed at the tourism industry.  For example, if a local government subsidises the building of a resort in a beach town, the tourist industry in that town will, presumably, benefit.

Second, there are ways economic policy can indirectly affect tourism.  For example, government monetary policies are most likely not aimed at tourism.  However, if a government's monetary policies cause the exchange rate for its currency to fall, tourism will likely benefit.  This is because the country's currency will become cheaper and vacations in that country will become less expensive for people in other countries.

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