T O U R I S M S A T E L L I T E ACCOUNT, A S T A T I S T I C A L T O O L TO A N A L Y S E TOURISM R O L E S

Iiirnal Kepariwisalaan Vol.V
.) ;\ V). / .Maret 2004

TOURISM S A T E L L I T E ACCOUNT,
A S T A T I S T I C A L T O O L TO ANALYSE
TOURISM R O L E S
IDA BAGUS M A D E WIYASHA
Pusat Peiielitiaii & Pengabdian Pada Masyarakai. .STP Bali
This article tries to explore Tourism Satellite Account ( T S A ) results in several
countries. It is a statistical tool used to derive tourism multiplier in a country's
economy. In preparing a T S A an input-output model is applied. Results
show differences in tourism roles in a countrv's economy due to the size
and leakage in tourism
Keywords: T S A , tourism multiplier, input-output model, tourism leakage
INTRODUCTION
Tourism has long been considered as
an industry that boosts a c o u n t r y ' s
economy. Yet it roles, especially m some
developing countries not yet analysed.
Since tourism is an amalgam industry, it
embraces some economic sectors of a

country. Sectors influenced directly and
indirectly by tourism are employment,
agriculture, manufacture, retail businesses,
accommodation and food s e r v i c e s ,
transportation, to mention a few. Other
intriguing questions on tourism roles are
how much they contribute to a country's
Gross Domestic Product (hereafter G D P ) ,
employment, how investments on tourism
affect other sectors, the forward and
backward linkage to other economic
sectors? To cope with these questions. The
World Tourism Organization (hereafter
W T O ) introduced the concept of Satellite
Account in the field of tourism, hence
Tourism Satellite Account (hereafter T S A ) ,
in 1994. The idea of T S A is to estimate the
tourism's roles in a country's economic
activities and thus be a basis in formulating
tourism policy. From international view of

point.jt standardi.ses the role of tourism and
,30

make it comparable to other e o u n t n o .
Though the T S A is developed by the W T O .
it accommodates the unit|ueness and
distinctness of each country m developing
its T S A . This article tries to explore TS.Y
in several countries, Australia. Canada.
New Zealand, France, U S A , Chile, and
Indonesia. The result ofrfcTSA
TSA. i.e. the
magnitude of tourism multiplier differs due
to the difference in leaktige in tourism in
each country, the definitions unci
methodology in estimating the TS.A and
data availability. The rest of this ptiper is
organized as follows: part II Concept of
T o u r i s m S a t e l l i t e A c c o u n t , oart 111
Developing T S A . part i V Measuring

tourism impact m the economy, and part V
Conclusions and limitations.
CONCEPT O F TOURISM S A T E L L I T E
ACCOUNT
A Satellite account is a statistical tool
for organizing all quantitative data relating
to a particular .sector of an economy in order
to provide knowledge and ptirtieular
features of that sector and link its analysis
to the economy of a country (Franz, 2001).
In a c o u n t r y ' s economic a c t i v i t y , a

WIYASHA

compilation of satellite accounts may
embrace the following fields: education,
health,
tourism,
transportation,
environment, etc.

In 1994, the W T O adopted the
tourism statistics and m the same year
Canada was the first country that launched
its initial national T o u r i s m Satellite
Account. Satellite Account, as discussed
earlier, is used to record the production and
used of an account, which does not belong
to a certain sector. Tourism for example, is
an amalgam industry that consists of
transportation, food and lodging, recreation
and entertainment, and travel agencies
( W T O 1998,). T h e Tourism Satellite
Account ( T S A ) could be defined as a
s t a t i s t i c a l tool for organizing a l l
quantitative data relating to tourism sector
in order to provide knowledge and
particular features of tourism .sector and to
link its analysis to other sectors in the
economic activities of a particular country.
In a T S A we could analyse both sides of

tourism sectors, deiriand and supply sides.
The analysis could further be broken down
to
tourist
expenditures,
tourism
contribution to G D P , how much tourism
buys from other sectors, how much tourism
contributes to other sectors, how tourism
investments contribute to tourism demand,
tourism value added, and the role of tourism
in creating employment in the economy. To
sum up, through development of T S A we
w i l l be able to measure the following
( W T O 1998):
1. Tourism contribution to G D P ;
2. Tourism ranking compared to other
economic sectors;
3. The number of Jobs by tourism sector
in an economy;

4. The amount of tourism investment;
5. T a x revenue generated by tourism
sector;

: iiiiirisin

Sale II tl Ac am ill

6. Tourism consumption;
7. Tourism impact on a country balance
of payment:
8. C h a r a c t e r i s t i c s of tourism human
resources;
D E V E L O P I N G A TSA
In developing a T S A , we could start
from the demand side of tourism. This
approach is done since tourism is a demand
side industry, there is no tourism if there is
no demand from the tourists. The supply
side is analysed after the demand one. In

the demand side concept and definitions of
visitor, tourism expenditures, goods and
services specific to tourism should be
clearly defined. On the supply side the
concept of basic tourism activities, tourism
industry, and main variables attached to
tourism industry should be clearly defined.
a. Demand side definitions
The crucial point in developing a T.S.A
is definition of every element to be
measured. In demand side the follow ing
should be well-defined ( W T O 1998:
Tourism satellite account: ,A conceptual
framework):
1. Visitor: the usual environment, the
duration of stay, purpose of travel,
and classification of visitor
2. Tourism expenditure
3. Goods and services specific to
tourism

b. Supply side definitions
In supply side the following should be
well-defined:
1. Characteristics of tourism activities
2. The tourism industry
.3. Main variables attached to the
tourism industry
c.

Methodology/measurement
Next step to do is the measurement for
the following:
31

Jurnal Kepariwisalaan Vol. 3 No. 1 Maret 2004

1. Tourism demand approach
2.
3.
4.

5.
6.

Tourism value added
Tourism G D P
Tourism employment
Tourism balance of payment
Tourism income for government
T h e r e are slight differences in
measuring the above variables among
countries. New Zealand for example,
measuring tourism value added based on
producer's price, while Australia and some
other countries measured it in basic price.
Usual environment also defined slight
differently among countries; since the
W T O only define it broadly, different
definitions may occur.
M E A S U R I N G T O U R I S M I M P A C T IN
THE ECONOMY

1. The input-output model: theory
To measure the impact of tourism
activities in the economy, an inputoutput ( T O ) model should be developed
as recommended by the W T O .
Historically Wassily Leontif, a Russian
bom economfst, has developed the I-O
model. H i s model was aimed at
analysing the economic structure in a
country (Akundi: 2002 and Budnick:
1988, pp. 195).
Applying the 1-0 matrix' we could
analyse the following (Akundi, 2002);
a. Changes
economy

in f i n a l demand

in the

b. T o t a l m u l t i p l i e r effect including

employment, earnings, and output.
c. Inter industry linkage
The 1-0 model works when the
following assumptions hold (Stynes, 2001)
1. Linearity among industry demands
2. Similar technology applied
3. T h e impact estimates
represent
economic activity within a single year

32

4. Tourists spending estimates are price
adjusted to the year of the model
Some countries including Indonesia
(Nespamas: 2000) applying the 1-0 model
in deriving a T S A to analy.se the tourism
impact in the economy.
The f o l l o w i n g matrices should be
developed to arrive at tourism multiplier:
1. Transaction matrix: contains the flow of
goods and services in the economy.
2. A-matrix: contains the distribution of
input per unit of output. Each coefficient
represents the amount one industry
purchases d i r e c t l y from another
industry per Rp 1 worth output.
3. Inverse ( T A ) - I matrix: contains the
multiplier of each industry to another.
To derive this inverse m a t r i x , an
intermediate ( I - A ) matrix is transformed
into an inverse ( T A ) - l one. An inverse
matrix usually called a total requirement
one, since from it we could analyse the
requirements of one industry from
others. Each coefficient (mij) in the
inverse ( I - A ) - l reveals the linkage
between industries in the economy.
Each (mij) reveals row indu.stry i sells
goods and services to column indu.stry
j . It is a forward linkage. On the other
side (mij) also reveals column indu.stry
j buys goods and services from row
industry i because of changes in
demand. It is a backward linkage. To
sum up it reveals the multiplier, i.e.
represents the decrease and increase in
the economy: income, employment, and
payroll due to changes in final demand
of the industry. In T S A context, (mij)
represents tourism multiplier in the
economy (agriculture or employment
for example) due to changes in final
demand of tourism industry.

WIYASHA : Tourism SatellU Account

multiplier using an 1-0 model. To simplify,
2.yxwvutsrponmlihgfedcbaYXVUTSRPONMLKIHGFEDCA
The input-output model: illustrative
let us assume only seven industries exist
examples
in a given economy.^ T h e input-output
To obtain a better understanding on
matrix below lists goods produced by each
how to derive a multiplier applying an 1-0
sector
and how much the output used by
model, an illustrative example is given
other sectors.'
below. It needs three steps to derive a
Table 1
Transaction matrix

Sectors
1
2
3
4
5
6
7

We

Agriculture
Mining
Construction
Manufacturing
Transportation
Trade
Tourism
Value added
Imports
Total

3

1

2

51949
369
1534
3672
10360
14936
451
801.50
33081
196502

80
18346
470
15700
4342
20698
1035
162611
.1

223280

4

1415 91220
4969 170920
826 20018
176203 865110
56747 150767
47070 180771
1645
25133
205881 906224
0
0
4947561 2410163

could read simply the above 7 x 7

matrix as follows:
1. In a certain year, agriculture sector spent
Rp 116352 as its input, which were
divided into agriculture itself Rp 51949,
Mining Rp 369,Construction Rp
1534,Manufacturing
Rp
3672,
Transportation R p 10360, Trade Rp
14936,Tourism Rp 4 5 1 , and imports
input Rp 33081.
2. Tourism on the other hand sold its
output to agriculture amounted to Rp

5

6

7

LD

Total output

4619
1008
12473
79418
66123
172066
16832
705952
-99
1058392

11187
51499
66388
211830
71618
468030
30942
1355091
-499
2266136

348
3646
11115
8678
5260
15100
2062
429895
449
476553

35684
-27477
381933
1016471
693175
1347464
398453
0
101
3845804

196502
223280
494757
2377082
1058392
2266135
476553
3845804
33081
10971586

451, Mining Rp 1035, Construction Rp
1645,
Manufacturing Rp 2 5 1 3 3 ,
Transportation Rp 16832, Trade Rp
30942, Its self Rp 2062, and to Local
Demand Rp 398453
3. Direct requirement matrix: contains
consumption of each sector. To arrive at the
technical coefficients, each column on the
above 7 x 7matrix is divided by its total.
The results show the basic structure of the
economy as shown by table 2 below.

Table 2
Direct requirement matrix (A-matrix)
Sectors
1
2
3
4
5
6
7

Agriculture
Mining
Construction
Manufacturing
Transportation
Trade
Tourism

1

7

3

4

5

6

7

.2644
.0018
.0078
.0187
,0527
.0760
,0023

.0004
.0822
.0021
.0703
.0194
.0927
.0046

.0029
,0100
,0017
.3561
.1147
.0951
.(X)33

.0378
.0709
.0083
.3589
.0626
.0750
.0104

.0044
.0010
.0118
.0750
.0625
.1626
.01.59

.0049
.0227
.0293
.0935
.0316
.2065
.0137

.0007
.0077
.0233
.0182
.0110
.0317
.0043

4. Next step to do is creating an identity matrix ( 1 ), which contains a # 1 along its
diagonal cells. Table 3 below shows its numbers.
33

Jiiriinl Kepariwisalaan

yxwvutsrponmlihgfedcbaYXVUTSRPONMLKIHGFEDCA

Vol. .1 No. I Maret 21)04

Table 3
Identity matrix (I)
Sectors
1
2

3
4

s
6

7

Agriculture
Mining
Construction
Manufacturing
Transportation
Trade
Tourism

1

2

3

4

l,(X)()

OOOO

11.000

11.000

O.iKH)

O.tHK)

l.tKK)

0.000

o.ooo

0.000

o.ooo

0.000

0.0(10

O.tKK)

1.000

O.tKIO

O.tKIO

O.tKIO

0.000
(MlOO

3

6

7

01)00

0 000

().()(10

().(,!()0

i).(K)()

1.000

(!.(!(10

0.000

0.000

0.000

0.000

Il.tKH)

1.000

0.000

(i.t)tlt)

o.ooo

o.ooo

o.ooo

0.000

0.00(1

1.000

O.OOt)

().(K)0

O.tXK)

O.IXIO

0.000

o.ooo

O.tKIO

1.000

5. After the identity matrix we create a (1-A) matrix derived by snbtrtictine lechiiicai
coefficient matrix (A-mtitrix) from identity matrix (1-matrix) coefficients. Table 4
below lists the coefficients of ( i - A ) matrix.

Table 4
(I-A) m a t r i x )
Sectors
1

1

4

5
6

7

Agriculliiie
Mining
Constriicliim
.Manufacturing
Transpoitatinn
Trade
Tourism

1

7

3

(i

4

.73,56

-.0004

• .tX)29

-.0370

-(1(144

-.0(149

-.0019

.m7x

-.0100

-.0709

-.OOlO

-.0227

-.0(177

-.(K)7S

- 0021

.9983

-.0083

-.0118

-.0293

-,0233

-.01X7

-.0703

-.3561

.6411

-.(175(1

-093.^

-.0182

-.0527

-.0194

-.1147

-.0626

.9375

-.0316

-.0110

-.0760

-.0927

-0951

-.0750

-1626

.79.35

.03147

-.0023

-.(HU6

-.0033

-.(1104

-,01.s9

-.01.77

9957

-.()0()7

6. Finally the Inverse (I-A)-1 matrix is derived from (1-A) matrix, also known as multiplier
matrix contains the effect of one sector to others. Table .5 below shows (he ct'fecl of
each sector to others.
Table .5
(I-A)-l matrix

Sectors
1
2
3
4
5
6
7

Agriculture
Mining
Construction
Manufacturing
Transportation
Trade
Tourism

1

7

3

4

N

6

/
.0044

1 ..3655

.(K)98

.0389

.0865

.0175

.0212

.01.37

1.1055

.0657

.1.723

.0217

.0.509

.0142

.0174

.0089

1.0166

.0227

.0224

.(1419

.0259

.0853

.1.540

.6278

1.63,54

.1X00

.22X9

.0551

.0904

.0402

.1777

.1268

1.0915

0670

.0211

.1614

.1.543

.2297

.2079

.24X4

1 .,3095

.0549

()()7X

.0096

.0164

.0229

.0229

.0219

1.0062

The above {1-,A)-I matrix tells us that every Rp 1 spent by indusliy 4 (manufacturing)
increases activity in industry 7 (tourism) by Rp 0,0.5. While on the other htiiitl every Rp
i spent by tourism increa.ses activity in manufacturing by Rp 0 . 0 2 .

34

WIYASHA

: limrisiii

Satvllit

Acciiuiil

3. T S A results in some countries
Results ot'TvSA in some countries could be analysed from underneath ( W T O )
Australia fiscal year 1997-1998
Total tourism consumption

Billions S A D

58.2

rOomest'.c tourism consumption

Billions S A D

45.4

Inbound tourism consumption

Billions S A U

12.8

Domestic share of tourism consumption