- Email: [email protected]
Methodological issues
Ann&
of TourLm Research, Vol. 18, pp. 485-495, Printed in the USA. All rights reserved.
1991 Copyright
0160.7383/91 $3 00 + .OO 0 1991 Pergamon Press plc and J. Jafari
METHODOLOGICAL Tourism Input-Output
ISSUES Analysis Helen Briassoulis
Southeastern
College,
Greece
Abstract: Input-output analysis applied to the analysis of the economic impacts of tourism has many advantages, but suffers from serious limitations. This article reviews the literature and identifies the methodological issues in tourism input-output studies and the solutions proposed thus far. It also provides a systematic classification and discussion of the old and new issues grouped into four categories: substantive issues, aggregation, structural change and prediction, and intangible impacts. Possibilities for improving the input-output model and limitations are discussed. Suggestions for future research include incorporating the effects of tourism induced development on regional economic structure and the economic value of intangible social and environmental impacts. Keywords: input-output analysis, tourism impacts, methodological issues. RCsumC: L’analyse entree-sortie appliqute 2 l’analyse des impacts tconomiques du dtveloppement touristique a beaucoup d’avantages mais elle souffre de limites strieuses. L’article passe en revue la littkrature et identifie les probltmes mCthodologiques sur l’approche du tourisme par l’analyse entree-sortie et les solutions propostes B ce jour. 11 expose aussi une classification et une discussion de questions mCthodologiques en quatre grandes cattgories: questions fondamentales, degrt d’aggrtgation, changement structural et prCvision, et impacts non quantifiables. On discute des possibilitCs d’amtlioration du modgle entrte-sortie, ainsi que des limites. Les suggestions pour une future recherche incluent: l’incorporation des effets du developpement induit par le tourisme sur les structures tconomiques rkgionales, et de la valeur Cconomique des impacts non quantifiables sociaux et environnementaux. Mots-cl&: analyse entreesortie, impacts du tourisme, questions mtthodologiques.
INTRODUCTION For many developed and developing countries of the world, tourism represents an important export industry contributing to economic growth and development. At the same time, it is recognized that tourism’s economic benefits to host countries may be less than what they are considered to be, because they entail costs such as import increases, dependence on foreign capital, income leakages, and the like. The Helen Briassoulis (Rodou 12, Maroussi 15122, Athens, Greece), holds a Diploma in Architecture (Athens, Greece), and a master’s and a Ph.D. in Urban and Regional Planning (University of Illinois, USA), and has taught at the University of Cincinnati (USA). She works as a consultant in Athens and teaches Statistics at a private college. She has published several articles on economic-environmental issues. 485
486
TOURISM
INPUT-OUTPUT
ANALYSIS
economic impacts of tourism have been analyzed rather thoroughly (especially when compared to its social, environmental, cultural, and other influences) by means of several analytical tools, among which the input-output model occupies a significant place. However, inputoutput analysis has been both praised and attacked as an appropriate method for assessing tourism’s economic impacts. The intent of this article is to contribute to the critical evaluation of the input-output model as a useful and valid tool in economic impact analysis for tourism. More specifically, it attempts a classification of the methodological issues identified in the related studies and discusses additional issues that future applications of the model have to consider. INPUT-OUTPUT
ANALYSIS
AND
TOURISM
The basic structure of the input-output model, the way it is generally applied to tourism impact analysis, and the principal methodological questions are among the topics discussed in the literature. Very thorough and well documented recent treatments of the subject can be found in Fletcher (1989) and Archer and Fletcher (1990). The input-output model assumes a classification of economic activity in a region, in general, into industrial sectors whose transactions (interindustry transactions) are described by means of a matrix A of technical coefficients. Each element a, of the matrix represents the value of output from sector i needed to produce a dollar’s (or any other national currency) worth of output of sector j. Each industrial sector produces the amount of output necessary to meet interindustry demands, as well as final demand caused by household consumption, government spending, investment, and exports. In addition, because of the general equilibrium assumption of the model, the value of output produced by each sector equals the value of output it purchases from other sectors, plus the value of primary inputs such as imports, wages, dividends, profits, taxes, etc. If X is the vector of output of all industrial sectors and Y is the final demand vector, then the basic inputoutput model is written as:
x=llx+y and solving
(1)
for X:
x =
(I -
A)_’ Y
(2)
matrix or the Leontief The matrix (I - A)-’ is known as the multiplier inverse, named after Leontief, who first developed input-output analysis. Each element of the matrix shows the direct and indirect changes in the output of sector i needed to meet a unit increase in the final demand for the output of sectorj. Summing down each column of the Leontief inverse, output multipliers for each sector are obtained showing the direct and indirect changes in sectoral output needed to meet one unit increase in final demand for the output of this sector. There are three principal assumptions underlying the working of the input-output model (Miller and Blair 1985). First, linear homoge-
HELEN
BRIASSOULIS
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neous production functions for each sector that translate into the assumptions of constant technical coefficients, absence of economies or diseconomies of scale and externalities, in general, no substitution among inputs, and stability of trade patterns among sectors and between them and the rest of the world. Second, the economy operates with spare capacity, which means that any increase in final demand can be met by an increase in sectoral output. Third, as regards employment, it is assumed that there is unemployment in the economy, so that any additional demand for labor translates into an increase in the number of employed persons. In order to simulate the impacts of tourist spending on the economy of a tourist region, the export component of the final demand vector is modified appropriately to reflect the distribution of tourist spending to the industrial sectors that participate directly in the activity of tourism. Therefore, they are the initial recipients of tourists’ money. The first input-output applications for tourism impact analysis, in the early 196Os, concerned essentially the broader phenomenon of recreation (Archer 1977; Fletcher 1989), and they were carried out on the basis of the aforementioned assumptions. However, it was soon realized that the model’s assumptions were very restrictive, at least in the case of tourism, leading to erroneous results. Several modifications of the model were suggested and applied in order to relax certain of these assumptions and, hence, to obtain more reliable estimates of tourism’s impacts. The most important of them are presented below. The ability of the economy of a study region to respond immediately to changes in final demand (i.e., the absence of capacity and supply constraints) has seriously been questioned by many researchers. Bryden (1973), in a study of the impact of tourism in the Caribbean region, argued that resources do not have zero opportunity costs, as it is implicitly assumed in input-output analysis. Hence, in the short-term, increased tourist spending will push prices upwards, increase demand for imports, and will consequently bring about redistribution of income in the region with related changes in consumption patterns. For the island of Antigua, the inability of the agricultural sector to meet increased requirements caused by tourism was simulated by excluding this sector from the technical coefficients matrix and including it in the imports vector. The result was a decrease in the impact of tourism caused by increased import requirements. A related effort to distinguish between competitive and noncompetitive imports and, hence, simulate domestic supply constraints, was made by O’Connor and Henry (1975). They multiplied the technical coefficients matrix by a matrix reflecting the level of competitive imports associated with each sector. Capacity constraints in general have been tackled by multiplying the technical coefficients matrix by an appropriate sectoral capacity constraints matrix (Wanhill 1987). S imilarly, labor supply constraints have been simulated by introducing a labor market constraint matrix in the solution of the basic input-output model (Archer and Fletcher 1990). In the case of tourism, as Bryden (1973) correctly argued, the hotel industry is characterized by capacity underutilization (reflected in ho-
488
TOURISM
INPUT-OUTPUT
ANALYSIS
tel occupancy rates of less than loo%), which means that additional tourists can be accommodated by the existing hotels with marginal (instead of average) increases in inputs from other sectors. This is why, in the input-output model for Antigua, he substituted marginal for the average technical coefficients for the hotel sector. The values of the multipliers that resulted were lower than those obtained from a model employing average coefficients. Finally, several studies have taken into account the varied consumption patterns of different types of visitors, as well as changes in consumption patterns of the local population brought about by tourism. These features have been simulated by disaggregating the final demand vector into subvectors representing different categories of tourists (Fletcher 1989) and different income groups (Archer 1977). There are, however, several other issues that arise in respect to applications of input-output analysis to tourism impact assessment; these are discussed separately. METHODOLOGICAL
ISSUES
The input-output model, as any other abstract model of reality, can address only certain questions regarding the working of the economic system, given that the explicit and implicit assumptions underlying the working of the model are met. In applications, methodological issues arise when one or more of these assumptions are not satisfied and the model must be modified, if possible, to represent reality better. If modifications are difficult to achieve, the model can be used but with proper caution concerning the validity of its results. Finally, if the model is used to answer questions beyond its parameters, then a case of misapplication exists, which is not a matter of the model’s structure but of the model’s use. a classification and discussion of the To enlarge on this subject, methodological issues in tourism input-output analysis is in order. The intent is to integrate the old with some new issues and to guide users of the model in applying it sensibly within the context of its limitations. The methodological issues may be grouped into four main structural change and precategories: substantive issues, aggregation, diction, and intangible impacts. Substantive Issues Most methodological issues identified and briefly discussed so far draw from the fundamental assumptions of the input-output model and the nature of tourism. Input-output analysis assumes economic sectors with a more or less homogeneous output and a known, actually invariable, production structure. It is agreed by some that tourism is not an economic sector in the traditional sense (Baud-Bovy and Lawson 1977; Fletcher 1989; Komilis 1986; Oosterhaven and Knijff 1988; and not even a multiproduct industry. It can be Zacharatos 1986), better conceptualized as a complex of inter-related and inseparable activities-travel, accommodation, sightseeing, entertainment, and other services. The implications of the nonhomogeneity of tourism as
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regards the use of the input-output model for the analysis of its impacts can be captured into four perspectives. First, tourism impacts must be sought in more than one conventional economic sectors. This view raises a sectoral aggregation question that requires further comments. Second, the linear and additive input-output relationships assumed among economic sectors leave out interaction effects. Because of the inter-relatedness of tourism activities, the interactions effects may be important and, consequently, the technical coefficients may not represent realistically the true relationships among sectors. Third, the constancy of the technical coefficients assumption has been shown to be unrealistic, even in the short term (Bryden 1973), because of capacity and supply constraints. Moreover, tourism, as any economic activity, passes from several stages during its development. The early stages of tourism development of an area are characterized by dynamic, short-term change implying that technical coefficients do not remain stable at least for some period. As a tourist region matures, the assumption of constant coefficients may be more acceptable. Fourth, except for import substitution because of capacity constraints in some sectors mainly (Archer 1977; Bryden 1973; O’Connor and Henry 1975), the broader possibility of substitution effects has not been tackled, except perhaps in one study. Assuming a constant consumer income, Oosterhaven and Knijff (1988) distinguish between recreational substitution (when tourist expenditures are shifted from less to most attractive recreation sites) and “normal” substitution (when consumers spend more on recreation and tourism and less in other consumer products and services). Besides these, substitution may also occur with such inputs as labor for capital or one type of labor for another. All these imply again that technical coefficients may change more frequently than desired in input-output applications. The nature and direction of their change is a matter of empirical investigation in a particular situation. Another assumption of input-output analysis, of particular importance at the subnational level of analysis, is that the study region is a system at an equilibrium state. However, almost by definition, the presence of tourism in a regionan entire nation or a region of it implies considerable interaction between the study region and the rest of the world, a fact that renders the general equilibrium assumption implausible. Moreover, because of the vulnerability of the tourist industry to exogenous influences (economic, political, social changes), it is also implausible to assume that, more or less, the study region is at or tends toward an equilibrium state. At best, it can be assumed to be in a dynamic equilibrium state. Violation of these assumptions is perhaps most important in the case of developing countries that have more open or evolving economies, with weak internal economic structure. In cases where tourism represents a new economic activity, all the input-output assumptions described earlier must be critically examined. Because the technical coefficients may be totally unknown, tourism development brings about structural changes of the existing economic structure, and even closed systems become open because of the establishment of flows between them and the outside world. Although introduction of a new sector in an existing system can be handled
490
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ANALYSIS
within the framework of input-output analysis (Miller and Blair 1985), a great deal of caution must be exercised in choosing the values of the coefficients and making hypotheses about the magnitude and nature of anticipated structural change.
Aggregation Aggregation concerns the way the spatial, temporal, and sectoral system of study is defined. The nature and level of aggregation used in a study determines critically the magnitude of impacts identified. There are three dimensions of aggregation. Spatial aggregation. The spatial level of analysis chosennational, regional, or local - depends on the purpose of the study and the availability of relevant data. The critical methodological question that must be addressed, at least in the case of tourism, is “how big the study region has to be so that impacts can be identified.” The choice is critical. On one hand, if the region is small (e.g., a city or a small island), it will be more open, leakages will be perhaps more serious, the share of imports in the technical coefficients will be significant, and data may not exist for reliable analysis. On the other hand, if the region is large (e.g., a nation), sectoral impacts will be spatially aggregated making their distribution over space difficult to detect, data will be used in aggregate form rendering difficult the isolation of tourism’s share in the total sectoral impact, and certain categories of impacts that may be important at lower levels may be obscured at the more aggregate level of analysis. Data are usually collected for administrative bodies, and the analyst does not have many alternatives in deciding the desirable size of the study region. However, several of these concerns can be accommodated by an inter-regional level of analysis, advocated by Oosterhaven and Knijff (1988). Th’ 1s enables the analyst to simulate and trace the impacts of interregional changes in the origin and destination of tourists, as well as in the distribution of tourist expenditures. Temporal aggregation. The time period within which impacts are identified and assessed depends again on the purpose of the study and the availability of data. Its choice is critical in tourism impact analysis because, at least until recently, tourism has exhibited a distinct seasonal pattern within the year, its influence being more salient from May to September. Consequently, certain technical coefficients used in input-output analysis may exhibit seasonality, which is concealed when annual data (the most common form) are used. When this is the case, several seasonal impacts (e.g., employment and sales of tourist shops) may be difficult to assess directly. At best, once annual impacts are assessed, seasonal indexes can be used to provide seasonal estimates of impacts. Sectoral aggregation. A fundamental consideration in input-output sis, sectoral aggregation (i.e., the basic sectoral classification adopted in a study), has important implications for tourism
analyscheme impact
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analysis. Because more than one conventional economic sectors participate in the production and consumption of the tourist product, assessment of tourism impacts requires disaggregation of the tourism-related sectors in order to detect impacts where they occur (Fletcher 1989). It is possible, however, that, if a high level of disaggregation is employed, certain impacts may be trivial. On the other hand, some form of aggregation of the separate sectoral impacts is required again (and provided in many studies) to derive total “tourism impacts.” The critical methodological issue is how to aggregate impacts from conceptually and essentially different sectors-a problem comparable to the product mix problem in input-output analysis (Miller and Blair 1985). Even though all impacts are expressed in monetary units, a dollar’s worth of retail trade output has different ultimate value than a dollar’s worth of a museum’s output in a distributional sense. The first accrues to an individual in the private sector and the second to the public sector. Moreover, the same monetary benefit has different direct and opportunity costs in each individual sector. Therefore, here lies the problem of lumping together sectoral impacts to derive total “tourism impacts.” One way to overcome this problem may be to devise a ranking of significance of the various sectors and use it to calculate the “tourism impact” as a weighted average of sectoral impacts, although such a ranking may introduce undesirable subjectivity into input-output calculations. However, it has to be kept in mind that the real value of input-output analysis lies in providing estimates of sectoral rather than total aggregate impacts of a multidimensional activity like tourism. Similarly, as regards tourism input-output multipliers, the question is what does the value of the multiplier represent when “one unit change in tourism” originates in more than one sectors and it impacts on a variety of other sectors. According to Bryden (1973), a “tourism multiplier,” calculated from an input-output model, is a weighted average of sectoral multipliers, assuming that a unit of tourist spending is distributed to certain sectors according to some known proportions. Consequently, the value of the multiplier obtained depends, in addition to the technical coefficients adopted, on the assumed sectoral distribution of tourist spending. Thus, it seems advisable to provide a range of different multipliers calculated on the basis of alternative sectoral distribution schemes of tourist spending. This may be of greater utility to tourism policymakers in assessing the implications of promoting certain tourism-related sectors in a region. Structural Change and Prediction Most researchers emphasize that input-output analysis is used to assess short- to medium-term tourism impacts, given that long-range forecasting requires more sophisticated modeling tools and better knowledge of the real world economic structure (Archer and Fletcher 1990; Fletcher 1989). In fact, assessment of long-term impacts requires some knowledge of and assumptions about the direction of future change in the basic structural economic relationships. Input-output analysis, in its original comparative static form, projects the status quo
492
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INPUT-OUTPUT
ANALYSIS
into the future, because the technical coefficients are assumed constant. For long-term impacts, this assumption is not plausible. One, tourism activities change in form and intensity under the influence of economic, technological, sociopolitical factors; hence, the coefficients cannot be assumed to remain constant for time periods longer than five to six years. Two, tourism induces development in the host region that would not probably otherwise occur. This is due mainly to provision of infrastructure for tourism, which opens up development possibilities in underdeveloped regions (e.g., second home development) and speculative land development in the vicinity of tourist areas aiming at benefiting from agglomeration economies (e.g., retail shops, gas stations, and restaurants). Consequently, with the onset of tourism in a region, structural change takes place, which means that the inputoutput coefficients must, at best, be updated frequently. However, there may still be certain problems in developing areas where tourism represents a new economic activity and, therefore, the magnitude and form of structural transformations of the region cannot be predicted reliably. Therefore, an input-output model can provide reliable long-term impact assessment only if it can be reliably assumed that the magnitude of anticipated structural change will not be important (the case of mature tourist regions); or if the magnitude of expected structural change can be approximated and taken into account in modifying properly the technical coefficients. In cases where qualitative changes in tourism activities take place (e.g., development of timesharing units instead of conventional forms of accommodation), a scenario approach to predicting impacts, with an input-output model, seems to be more appropriate.
Intangible Impacts It is well known that tourism impacts not only on the economy of a region but also on its social and cultural structure as well as on its environment. These latter are intangible impacts in the sense that they cannot be assessed completely by using monetary yardsticks. An input-output model, by definition, ignores these intangible impacts because they cannot be meaningfully represented by economic sectors. Therefore, the economic impacts that are assessed by input-output analysis represent only part of the total economic value of tourism’s impacts. The other part consists of the economic value of social, environmental, and cultural impacts that is sometimes negative instead of positive. Therefore, even if application of input-output analysis is considered valid in a given situation, it should be remembered that it does not provide a complete account of the economic impacts of tourism.
CONCLUSIONS Input-output analysis has been used cause of its (a) comprehensiveness-the
in tourism impact studies beinput-output model provides
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a holistic picture of the economic structure of a region (or a system of regions) and enables the analyst to identify interrelationships among economic sectors; and (b) flexibilitydepending on the level of detail desired in an application and the available resources, any economic sector can be disaggregated, and its relationships to the other sectors can be traced and studied in detail (Archer and Fletcher 1988; Fletcher 1989). Moreover, according to Archer and Fletcher (1988), because tourism is labor intensive, it is characterized by stable production functions. This implies that the assumption of homogeneous production functions and constant technical coefficients of input-output analysis is not seriously violated. But it was argued earlier that, for several other reasons, the constancy of the technical coefficients cannot be accepted lightly, even in the short run. Thus, this last advantage of input-output analysis does not seem to be very valid, unless empirical evidence is offered to the contrary. Nevertheless, input-output analysis has serious limitations (not limited to tourism though), some of which were discussed in this article; even additional ones may be identified in the future. Moreover, the input-output model is “data hungry.” This makes it proper application expensive and time-consuming, unless resources are ample and the data base is continuously updated. If limited resources dictate a high level of aggregation, the results obtained are not very accurate and, consequently, of questionable value for decision making. As regards the usefulness of input-output analysis for decision making, it can provide answers basically to the question “if demand for the output of certain sectors increases by an amount X, what will be the changes in the volume of production of all sectors to meet this demand.” If the policymaker asks other types of questions, such as “what is the optimum level of production in each sector to achieve (tourism and other) objectives A, B, C, etc.?” or “What is the cost-effectiveness of promoting tourism in region X” then input-output analysis alone cannot provide the answer. Alternative quantitative methodologies, like cost-benefit analysis and optimization, will be the appropriate analytical tools (Bryden 1973; Kottke 1988). The modifications of the input-output model employed to date, to relax certain of its restrictive assumptions, show that, with careful manipulation, this model can be used given its important advantages. However, as this article indicates, future research has to address several other methodological issues to refine the model and render it a more reliable analytical tool. Based on the discussion of this paper, live research directions may be identified. First, assessment of the structural changes brought about by induced development caused by tourism and incorporating them into the input-output framework. Many tourist towns and regions have developed spatially in the direction of hotels and other tourist sites, the result being a restructuring of the location and nature of economic activity in the region. No studies seem to exist which document and analyze these phenomena whose importance in the context of inputoutput analysis is large, given that they affect the magnitude and direction of change of the technical coefficients. Second, a parallel research effort can be in the direction of a longitu-
494
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ANALYSIS
dinal study of changes in the technical coefficients of tourist regions and the relationship of these changes with different stages of tourism growth. Comparisons between different types of tourist regions will contribute, on the one hand, to improved understanding of structural changes and better predictive ability of the input-output model and, on the other hand, to theory building concerning tourism development. Third, assessment of employment impacts of tourism is fraught with many difficultiesbecause of the seasonality problem and because many persons employed in tourism also hold another job, data are not very reliable, and part-time (especially female) employment is very common in tourism-related establishments (Oosterhaven and Knijff 1988). Some effort must be made to incorporate these considerations within the input-output framework in order to produce more reliable estimates of tourism employment impacts. Fourth, assessment of the intangible social and environmental impacts of tourism and linking them with the input-output model. This can be done by either incorporating these impacts within the inputoutput framework (cf., Briassoulis 1986; Isard 1973; Leontief 1970; Victor 1972) or by linking the input-output model with other social and environmental impact models in the context of an integrated model (cf., Briassoulis 1985; Nijkamp 1980). Fifth, as regards the existence of supply constraints in some sectors alternative approaches in tourism input-output studies are unattempted. They are Tiebout’s (1969) approach to fix the output of certain sectors and solve for the output of the remaining sectors and Briassoulis’ (1985) partitioned-matrix technique. Further research on the use of input-output analysis in tourism impact studies will alleviate most of the methodological issues identified in this article. The advanced tool can be used as a reliable aid in decision making in tourism planning and development. 0 0 Acknowledgments-The author is indebted to Dr. John some very basic pieces of literature on the topic.
Fletcher
who kindly
supplied
REFERENCES Archer, Brian H. 1977 Tourism Multipliers: The State of the Art. Bangor Occasional Papers in Economics. Cardiff: University of Wales Press. Archer, Brian H., and J. E. Fletcher 1988 The Tourist Multiplier. Teoros 7(3):6-g. 1990 Multiplier Analysis in Tourism. Cahiers du Tourisme, Serie C. No. 103. Aix-en-Provence: Centre des Hautes Etudes Touristiques. Baud-Bovy, M., and F. Lawson 1977 Tourism and Recreation Development. London: the Architectural Press. Briassoulis, Helen 1985 An Integrated Modeling Approach to the Analysis of Impacts of Acid Deposition Control Regulations. Ph.D. dissertation, University of Illinois, Urbana. 1986 Input-Output Analysis and Pollution Damage Costs: An Integration. ProConference, Pittsburgh, Research ceedings of 17th “Modeling and Simulation” Triangle Park, Instrument Society of America. Bryden, John 1973 Tourism and Development: A Case Study of the Commonwealth Caribbean. Cambridge: Cambridge University Press.
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Fletcher, John E. 1989 Input-Output Analysis and Tourism Impact Studies. Annals of Tourism Research 16(4):514-529. Isard, Walter 1972 Ecologic-Economic Analysis for Regional Development. New York: The Free Press. Komilis, P. 1986 Touristic Activities. (in Greek) Athens, Greece: KEPE. Kottke, M. 1988 Estimating Tourism Impacts. Annals of Tourism Research 14(1):122-133. Leontief, Wassily 1970 Environmental Repercussions and the Economic Structure. Review of Economics and Statistics 52:262-271. Miller, Ronald, E., and P. D. Blair 1985 Input-Output Analysis: Foundations and Extensions. Englewood Cliffs NJ: Prentice-Hall. Nijkamp, Peter 1980 Environmental Policy Analysis. New York: John Wiley. O’Connor and Henry 1975 Input-Output Analysis and its Applications. Griffin’s Statistical Monographs, No.36. London: Charles Griffin’s and Co. Oosterhaven, J., and E. C. Van Der Knijff 1988 On the Economic Imnacts of Recreation and Tourism: The Innut-Outuut A 1 Approach. Built Environment 13(2):96-108. Tiebout, Charles 1969 An Empirical Input-Output Projection Model: The State of Washington 1980. The Review of Economics and Statistics LI(3):334-340. Victor, P. 1972 Pollution: Economy and the Environment: Toronto: University of Toronto Press. Wanhill, S. R. C. 1987 Making Tourism Work. Inaugural Lecture, University of Surrey, England. Zacharatos, P. 1986 Tourist Consumption. (In Greek) Athens, Greece: KEPE. Submitted 16 August 1990 Revised version submitted 26 January Accepted 11 February 1991 Refereed anonymously Coordinating Editor: Abraham Pizam
1991
of TourLm Research, Vol. 18, pp. 485-495, Printed in the USA. All rights reserved.
1991 Copyright
0160.7383/91 $3 00 + .OO 0 1991 Pergamon Press plc and J. Jafari
METHODOLOGICAL Tourism Input-Output
ISSUES Analysis Helen Briassoulis
Southeastern
College,
Greece
Abstract: Input-output analysis applied to the analysis of the economic impacts of tourism has many advantages, but suffers from serious limitations. This article reviews the literature and identifies the methodological issues in tourism input-output studies and the solutions proposed thus far. It also provides a systematic classification and discussion of the old and new issues grouped into four categories: substantive issues, aggregation, structural change and prediction, and intangible impacts. Possibilities for improving the input-output model and limitations are discussed. Suggestions for future research include incorporating the effects of tourism induced development on regional economic structure and the economic value of intangible social and environmental impacts. Keywords: input-output analysis, tourism impacts, methodological issues. RCsumC: L’analyse entree-sortie appliqute 2 l’analyse des impacts tconomiques du dtveloppement touristique a beaucoup d’avantages mais elle souffre de limites strieuses. L’article passe en revue la littkrature et identifie les probltmes mCthodologiques sur l’approche du tourisme par l’analyse entree-sortie et les solutions propostes B ce jour. 11 expose aussi une classification et une discussion de questions mCthodologiques en quatre grandes cattgories: questions fondamentales, degrt d’aggrtgation, changement structural et prCvision, et impacts non quantifiables. On discute des possibilitCs d’amtlioration du modgle entrte-sortie, ainsi que des limites. Les suggestions pour une future recherche incluent: l’incorporation des effets du developpement induit par le tourisme sur les structures tconomiques rkgionales, et de la valeur Cconomique des impacts non quantifiables sociaux et environnementaux. Mots-cl&: analyse entreesortie, impacts du tourisme, questions mtthodologiques.
INTRODUCTION For many developed and developing countries of the world, tourism represents an important export industry contributing to economic growth and development. At the same time, it is recognized that tourism’s economic benefits to host countries may be less than what they are considered to be, because they entail costs such as import increases, dependence on foreign capital, income leakages, and the like. The Helen Briassoulis (Rodou 12, Maroussi 15122, Athens, Greece), holds a Diploma in Architecture (Athens, Greece), and a master’s and a Ph.D. in Urban and Regional Planning (University of Illinois, USA), and has taught at the University of Cincinnati (USA). She works as a consultant in Athens and teaches Statistics at a private college. She has published several articles on economic-environmental issues. 485
486
TOURISM
INPUT-OUTPUT
ANALYSIS
economic impacts of tourism have been analyzed rather thoroughly (especially when compared to its social, environmental, cultural, and other influences) by means of several analytical tools, among which the input-output model occupies a significant place. However, inputoutput analysis has been both praised and attacked as an appropriate method for assessing tourism’s economic impacts. The intent of this article is to contribute to the critical evaluation of the input-output model as a useful and valid tool in economic impact analysis for tourism. More specifically, it attempts a classification of the methodological issues identified in the related studies and discusses additional issues that future applications of the model have to consider. INPUT-OUTPUT
ANALYSIS
AND
TOURISM
The basic structure of the input-output model, the way it is generally applied to tourism impact analysis, and the principal methodological questions are among the topics discussed in the literature. Very thorough and well documented recent treatments of the subject can be found in Fletcher (1989) and Archer and Fletcher (1990). The input-output model assumes a classification of economic activity in a region, in general, into industrial sectors whose transactions (interindustry transactions) are described by means of a matrix A of technical coefficients. Each element a, of the matrix represents the value of output from sector i needed to produce a dollar’s (or any other national currency) worth of output of sector j. Each industrial sector produces the amount of output necessary to meet interindustry demands, as well as final demand caused by household consumption, government spending, investment, and exports. In addition, because of the general equilibrium assumption of the model, the value of output produced by each sector equals the value of output it purchases from other sectors, plus the value of primary inputs such as imports, wages, dividends, profits, taxes, etc. If X is the vector of output of all industrial sectors and Y is the final demand vector, then the basic inputoutput model is written as:
x=llx+y and solving
(1)
for X:
x =
(I -
A)_’ Y
(2)
matrix or the Leontief The matrix (I - A)-’ is known as the multiplier inverse, named after Leontief, who first developed input-output analysis. Each element of the matrix shows the direct and indirect changes in the output of sector i needed to meet a unit increase in the final demand for the output of sectorj. Summing down each column of the Leontief inverse, output multipliers for each sector are obtained showing the direct and indirect changes in sectoral output needed to meet one unit increase in final demand for the output of this sector. There are three principal assumptions underlying the working of the input-output model (Miller and Blair 1985). First, linear homoge-
HELEN
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neous production functions for each sector that translate into the assumptions of constant technical coefficients, absence of economies or diseconomies of scale and externalities, in general, no substitution among inputs, and stability of trade patterns among sectors and between them and the rest of the world. Second, the economy operates with spare capacity, which means that any increase in final demand can be met by an increase in sectoral output. Third, as regards employment, it is assumed that there is unemployment in the economy, so that any additional demand for labor translates into an increase in the number of employed persons. In order to simulate the impacts of tourist spending on the economy of a tourist region, the export component of the final demand vector is modified appropriately to reflect the distribution of tourist spending to the industrial sectors that participate directly in the activity of tourism. Therefore, they are the initial recipients of tourists’ money. The first input-output applications for tourism impact analysis, in the early 196Os, concerned essentially the broader phenomenon of recreation (Archer 1977; Fletcher 1989), and they were carried out on the basis of the aforementioned assumptions. However, it was soon realized that the model’s assumptions were very restrictive, at least in the case of tourism, leading to erroneous results. Several modifications of the model were suggested and applied in order to relax certain of these assumptions and, hence, to obtain more reliable estimates of tourism’s impacts. The most important of them are presented below. The ability of the economy of a study region to respond immediately to changes in final demand (i.e., the absence of capacity and supply constraints) has seriously been questioned by many researchers. Bryden (1973), in a study of the impact of tourism in the Caribbean region, argued that resources do not have zero opportunity costs, as it is implicitly assumed in input-output analysis. Hence, in the short-term, increased tourist spending will push prices upwards, increase demand for imports, and will consequently bring about redistribution of income in the region with related changes in consumption patterns. For the island of Antigua, the inability of the agricultural sector to meet increased requirements caused by tourism was simulated by excluding this sector from the technical coefficients matrix and including it in the imports vector. The result was a decrease in the impact of tourism caused by increased import requirements. A related effort to distinguish between competitive and noncompetitive imports and, hence, simulate domestic supply constraints, was made by O’Connor and Henry (1975). They multiplied the technical coefficients matrix by a matrix reflecting the level of competitive imports associated with each sector. Capacity constraints in general have been tackled by multiplying the technical coefficients matrix by an appropriate sectoral capacity constraints matrix (Wanhill 1987). S imilarly, labor supply constraints have been simulated by introducing a labor market constraint matrix in the solution of the basic input-output model (Archer and Fletcher 1990). In the case of tourism, as Bryden (1973) correctly argued, the hotel industry is characterized by capacity underutilization (reflected in ho-
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tel occupancy rates of less than loo%), which means that additional tourists can be accommodated by the existing hotels with marginal (instead of average) increases in inputs from other sectors. This is why, in the input-output model for Antigua, he substituted marginal for the average technical coefficients for the hotel sector. The values of the multipliers that resulted were lower than those obtained from a model employing average coefficients. Finally, several studies have taken into account the varied consumption patterns of different types of visitors, as well as changes in consumption patterns of the local population brought about by tourism. These features have been simulated by disaggregating the final demand vector into subvectors representing different categories of tourists (Fletcher 1989) and different income groups (Archer 1977). There are, however, several other issues that arise in respect to applications of input-output analysis to tourism impact assessment; these are discussed separately. METHODOLOGICAL
ISSUES
The input-output model, as any other abstract model of reality, can address only certain questions regarding the working of the economic system, given that the explicit and implicit assumptions underlying the working of the model are met. In applications, methodological issues arise when one or more of these assumptions are not satisfied and the model must be modified, if possible, to represent reality better. If modifications are difficult to achieve, the model can be used but with proper caution concerning the validity of its results. Finally, if the model is used to answer questions beyond its parameters, then a case of misapplication exists, which is not a matter of the model’s structure but of the model’s use. a classification and discussion of the To enlarge on this subject, methodological issues in tourism input-output analysis is in order. The intent is to integrate the old with some new issues and to guide users of the model in applying it sensibly within the context of its limitations. The methodological issues may be grouped into four main structural change and precategories: substantive issues, aggregation, diction, and intangible impacts. Substantive Issues Most methodological issues identified and briefly discussed so far draw from the fundamental assumptions of the input-output model and the nature of tourism. Input-output analysis assumes economic sectors with a more or less homogeneous output and a known, actually invariable, production structure. It is agreed by some that tourism is not an economic sector in the traditional sense (Baud-Bovy and Lawson 1977; Fletcher 1989; Komilis 1986; Oosterhaven and Knijff 1988; and not even a multiproduct industry. It can be Zacharatos 1986), better conceptualized as a complex of inter-related and inseparable activities-travel, accommodation, sightseeing, entertainment, and other services. The implications of the nonhomogeneity of tourism as
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regards the use of the input-output model for the analysis of its impacts can be captured into four perspectives. First, tourism impacts must be sought in more than one conventional economic sectors. This view raises a sectoral aggregation question that requires further comments. Second, the linear and additive input-output relationships assumed among economic sectors leave out interaction effects. Because of the inter-relatedness of tourism activities, the interactions effects may be important and, consequently, the technical coefficients may not represent realistically the true relationships among sectors. Third, the constancy of the technical coefficients assumption has been shown to be unrealistic, even in the short term (Bryden 1973), because of capacity and supply constraints. Moreover, tourism, as any economic activity, passes from several stages during its development. The early stages of tourism development of an area are characterized by dynamic, short-term change implying that technical coefficients do not remain stable at least for some period. As a tourist region matures, the assumption of constant coefficients may be more acceptable. Fourth, except for import substitution because of capacity constraints in some sectors mainly (Archer 1977; Bryden 1973; O’Connor and Henry 1975), the broader possibility of substitution effects has not been tackled, except perhaps in one study. Assuming a constant consumer income, Oosterhaven and Knijff (1988) distinguish between recreational substitution (when tourist expenditures are shifted from less to most attractive recreation sites) and “normal” substitution (when consumers spend more on recreation and tourism and less in other consumer products and services). Besides these, substitution may also occur with such inputs as labor for capital or one type of labor for another. All these imply again that technical coefficients may change more frequently than desired in input-output applications. The nature and direction of their change is a matter of empirical investigation in a particular situation. Another assumption of input-output analysis, of particular importance at the subnational level of analysis, is that the study region is a system at an equilibrium state. However, almost by definition, the presence of tourism in a regionan entire nation or a region of it implies considerable interaction between the study region and the rest of the world, a fact that renders the general equilibrium assumption implausible. Moreover, because of the vulnerability of the tourist industry to exogenous influences (economic, political, social changes), it is also implausible to assume that, more or less, the study region is at or tends toward an equilibrium state. At best, it can be assumed to be in a dynamic equilibrium state. Violation of these assumptions is perhaps most important in the case of developing countries that have more open or evolving economies, with weak internal economic structure. In cases where tourism represents a new economic activity, all the input-output assumptions described earlier must be critically examined. Because the technical coefficients may be totally unknown, tourism development brings about structural changes of the existing economic structure, and even closed systems become open because of the establishment of flows between them and the outside world. Although introduction of a new sector in an existing system can be handled
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within the framework of input-output analysis (Miller and Blair 1985), a great deal of caution must be exercised in choosing the values of the coefficients and making hypotheses about the magnitude and nature of anticipated structural change.
Aggregation Aggregation concerns the way the spatial, temporal, and sectoral system of study is defined. The nature and level of aggregation used in a study determines critically the magnitude of impacts identified. There are three dimensions of aggregation. Spatial aggregation. The spatial level of analysis chosennational, regional, or local - depends on the purpose of the study and the availability of relevant data. The critical methodological question that must be addressed, at least in the case of tourism, is “how big the study region has to be so that impacts can be identified.” The choice is critical. On one hand, if the region is small (e.g., a city or a small island), it will be more open, leakages will be perhaps more serious, the share of imports in the technical coefficients will be significant, and data may not exist for reliable analysis. On the other hand, if the region is large (e.g., a nation), sectoral impacts will be spatially aggregated making their distribution over space difficult to detect, data will be used in aggregate form rendering difficult the isolation of tourism’s share in the total sectoral impact, and certain categories of impacts that may be important at lower levels may be obscured at the more aggregate level of analysis. Data are usually collected for administrative bodies, and the analyst does not have many alternatives in deciding the desirable size of the study region. However, several of these concerns can be accommodated by an inter-regional level of analysis, advocated by Oosterhaven and Knijff (1988). Th’ 1s enables the analyst to simulate and trace the impacts of interregional changes in the origin and destination of tourists, as well as in the distribution of tourist expenditures. Temporal aggregation. The time period within which impacts are identified and assessed depends again on the purpose of the study and the availability of data. Its choice is critical in tourism impact analysis because, at least until recently, tourism has exhibited a distinct seasonal pattern within the year, its influence being more salient from May to September. Consequently, certain technical coefficients used in input-output analysis may exhibit seasonality, which is concealed when annual data (the most common form) are used. When this is the case, several seasonal impacts (e.g., employment and sales of tourist shops) may be difficult to assess directly. At best, once annual impacts are assessed, seasonal indexes can be used to provide seasonal estimates of impacts. Sectoral aggregation. A fundamental consideration in input-output sis, sectoral aggregation (i.e., the basic sectoral classification adopted in a study), has important implications for tourism
analyscheme impact
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analysis. Because more than one conventional economic sectors participate in the production and consumption of the tourist product, assessment of tourism impacts requires disaggregation of the tourism-related sectors in order to detect impacts where they occur (Fletcher 1989). It is possible, however, that, if a high level of disaggregation is employed, certain impacts may be trivial. On the other hand, some form of aggregation of the separate sectoral impacts is required again (and provided in many studies) to derive total “tourism impacts.” The critical methodological issue is how to aggregate impacts from conceptually and essentially different sectors-a problem comparable to the product mix problem in input-output analysis (Miller and Blair 1985). Even though all impacts are expressed in monetary units, a dollar’s worth of retail trade output has different ultimate value than a dollar’s worth of a museum’s output in a distributional sense. The first accrues to an individual in the private sector and the second to the public sector. Moreover, the same monetary benefit has different direct and opportunity costs in each individual sector. Therefore, here lies the problem of lumping together sectoral impacts to derive total “tourism impacts.” One way to overcome this problem may be to devise a ranking of significance of the various sectors and use it to calculate the “tourism impact” as a weighted average of sectoral impacts, although such a ranking may introduce undesirable subjectivity into input-output calculations. However, it has to be kept in mind that the real value of input-output analysis lies in providing estimates of sectoral rather than total aggregate impacts of a multidimensional activity like tourism. Similarly, as regards tourism input-output multipliers, the question is what does the value of the multiplier represent when “one unit change in tourism” originates in more than one sectors and it impacts on a variety of other sectors. According to Bryden (1973), a “tourism multiplier,” calculated from an input-output model, is a weighted average of sectoral multipliers, assuming that a unit of tourist spending is distributed to certain sectors according to some known proportions. Consequently, the value of the multiplier obtained depends, in addition to the technical coefficients adopted, on the assumed sectoral distribution of tourist spending. Thus, it seems advisable to provide a range of different multipliers calculated on the basis of alternative sectoral distribution schemes of tourist spending. This may be of greater utility to tourism policymakers in assessing the implications of promoting certain tourism-related sectors in a region. Structural Change and Prediction Most researchers emphasize that input-output analysis is used to assess short- to medium-term tourism impacts, given that long-range forecasting requires more sophisticated modeling tools and better knowledge of the real world economic structure (Archer and Fletcher 1990; Fletcher 1989). In fact, assessment of long-term impacts requires some knowledge of and assumptions about the direction of future change in the basic structural economic relationships. Input-output analysis, in its original comparative static form, projects the status quo
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into the future, because the technical coefficients are assumed constant. For long-term impacts, this assumption is not plausible. One, tourism activities change in form and intensity under the influence of economic, technological, sociopolitical factors; hence, the coefficients cannot be assumed to remain constant for time periods longer than five to six years. Two, tourism induces development in the host region that would not probably otherwise occur. This is due mainly to provision of infrastructure for tourism, which opens up development possibilities in underdeveloped regions (e.g., second home development) and speculative land development in the vicinity of tourist areas aiming at benefiting from agglomeration economies (e.g., retail shops, gas stations, and restaurants). Consequently, with the onset of tourism in a region, structural change takes place, which means that the inputoutput coefficients must, at best, be updated frequently. However, there may still be certain problems in developing areas where tourism represents a new economic activity and, therefore, the magnitude and form of structural transformations of the region cannot be predicted reliably. Therefore, an input-output model can provide reliable long-term impact assessment only if it can be reliably assumed that the magnitude of anticipated structural change will not be important (the case of mature tourist regions); or if the magnitude of expected structural change can be approximated and taken into account in modifying properly the technical coefficients. In cases where qualitative changes in tourism activities take place (e.g., development of timesharing units instead of conventional forms of accommodation), a scenario approach to predicting impacts, with an input-output model, seems to be more appropriate.
Intangible Impacts It is well known that tourism impacts not only on the economy of a region but also on its social and cultural structure as well as on its environment. These latter are intangible impacts in the sense that they cannot be assessed completely by using monetary yardsticks. An input-output model, by definition, ignores these intangible impacts because they cannot be meaningfully represented by economic sectors. Therefore, the economic impacts that are assessed by input-output analysis represent only part of the total economic value of tourism’s impacts. The other part consists of the economic value of social, environmental, and cultural impacts that is sometimes negative instead of positive. Therefore, even if application of input-output analysis is considered valid in a given situation, it should be remembered that it does not provide a complete account of the economic impacts of tourism.
CONCLUSIONS Input-output analysis has been used cause of its (a) comprehensiveness-the
in tourism impact studies beinput-output model provides
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a holistic picture of the economic structure of a region (or a system of regions) and enables the analyst to identify interrelationships among economic sectors; and (b) flexibilitydepending on the level of detail desired in an application and the available resources, any economic sector can be disaggregated, and its relationships to the other sectors can be traced and studied in detail (Archer and Fletcher 1988; Fletcher 1989). Moreover, according to Archer and Fletcher (1988), because tourism is labor intensive, it is characterized by stable production functions. This implies that the assumption of homogeneous production functions and constant technical coefficients of input-output analysis is not seriously violated. But it was argued earlier that, for several other reasons, the constancy of the technical coefficients cannot be accepted lightly, even in the short run. Thus, this last advantage of input-output analysis does not seem to be very valid, unless empirical evidence is offered to the contrary. Nevertheless, input-output analysis has serious limitations (not limited to tourism though), some of which were discussed in this article; even additional ones may be identified in the future. Moreover, the input-output model is “data hungry.” This makes it proper application expensive and time-consuming, unless resources are ample and the data base is continuously updated. If limited resources dictate a high level of aggregation, the results obtained are not very accurate and, consequently, of questionable value for decision making. As regards the usefulness of input-output analysis for decision making, it can provide answers basically to the question “if demand for the output of certain sectors increases by an amount X, what will be the changes in the volume of production of all sectors to meet this demand.” If the policymaker asks other types of questions, such as “what is the optimum level of production in each sector to achieve (tourism and other) objectives A, B, C, etc.?” or “What is the cost-effectiveness of promoting tourism in region X” then input-output analysis alone cannot provide the answer. Alternative quantitative methodologies, like cost-benefit analysis and optimization, will be the appropriate analytical tools (Bryden 1973; Kottke 1988). The modifications of the input-output model employed to date, to relax certain of its restrictive assumptions, show that, with careful manipulation, this model can be used given its important advantages. However, as this article indicates, future research has to address several other methodological issues to refine the model and render it a more reliable analytical tool. Based on the discussion of this paper, live research directions may be identified. First, assessment of the structural changes brought about by induced development caused by tourism and incorporating them into the input-output framework. Many tourist towns and regions have developed spatially in the direction of hotels and other tourist sites, the result being a restructuring of the location and nature of economic activity in the region. No studies seem to exist which document and analyze these phenomena whose importance in the context of inputoutput analysis is large, given that they affect the magnitude and direction of change of the technical coefficients. Second, a parallel research effort can be in the direction of a longitu-
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dinal study of changes in the technical coefficients of tourist regions and the relationship of these changes with different stages of tourism growth. Comparisons between different types of tourist regions will contribute, on the one hand, to improved understanding of structural changes and better predictive ability of the input-output model and, on the other hand, to theory building concerning tourism development. Third, assessment of employment impacts of tourism is fraught with many difficultiesbecause of the seasonality problem and because many persons employed in tourism also hold another job, data are not very reliable, and part-time (especially female) employment is very common in tourism-related establishments (Oosterhaven and Knijff 1988). Some effort must be made to incorporate these considerations within the input-output framework in order to produce more reliable estimates of tourism employment impacts. Fourth, assessment of the intangible social and environmental impacts of tourism and linking them with the input-output model. This can be done by either incorporating these impacts within the inputoutput framework (cf., Briassoulis 1986; Isard 1973; Leontief 1970; Victor 1972) or by linking the input-output model with other social and environmental impact models in the context of an integrated model (cf., Briassoulis 1985; Nijkamp 1980). Fifth, as regards the existence of supply constraints in some sectors alternative approaches in tourism input-output studies are unattempted. They are Tiebout’s (1969) approach to fix the output of certain sectors and solve for the output of the remaining sectors and Briassoulis’ (1985) partitioned-matrix technique. Further research on the use of input-output analysis in tourism impact studies will alleviate most of the methodological issues identified in this article. The advanced tool can be used as a reliable aid in decision making in tourism planning and development. 0 0 Acknowledgments-The author is indebted to Dr. John some very basic pieces of literature on the topic.
Fletcher
who kindly
supplied
REFERENCES Archer, Brian H. 1977 Tourism Multipliers: The State of the Art. Bangor Occasional Papers in Economics. Cardiff: University of Wales Press. Archer, Brian H., and J. E. Fletcher 1988 The Tourist Multiplier. Teoros 7(3):6-g. 1990 Multiplier Analysis in Tourism. Cahiers du Tourisme, Serie C. No. 103. Aix-en-Provence: Centre des Hautes Etudes Touristiques. Baud-Bovy, M., and F. Lawson 1977 Tourism and Recreation Development. London: the Architectural Press. Briassoulis, Helen 1985 An Integrated Modeling Approach to the Analysis of Impacts of Acid Deposition Control Regulations. Ph.D. dissertation, University of Illinois, Urbana. 1986 Input-Output Analysis and Pollution Damage Costs: An Integration. ProConference, Pittsburgh, Research ceedings of 17th “Modeling and Simulation” Triangle Park, Instrument Society of America. Bryden, John 1973 Tourism and Development: A Case Study of the Commonwealth Caribbean. Cambridge: Cambridge University Press.
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Fletcher, John E. 1989 Input-Output Analysis and Tourism Impact Studies. Annals of Tourism Research 16(4):514-529. Isard, Walter 1972 Ecologic-Economic Analysis for Regional Development. New York: The Free Press. Komilis, P. 1986 Touristic Activities. (in Greek) Athens, Greece: KEPE. Kottke, M. 1988 Estimating Tourism Impacts. Annals of Tourism Research 14(1):122-133. Leontief, Wassily 1970 Environmental Repercussions and the Economic Structure. Review of Economics and Statistics 52:262-271. Miller, Ronald, E., and P. D. Blair 1985 Input-Output Analysis: Foundations and Extensions. Englewood Cliffs NJ: Prentice-Hall. Nijkamp, Peter 1980 Environmental Policy Analysis. New York: John Wiley. O’Connor and Henry 1975 Input-Output Analysis and its Applications. Griffin’s Statistical Monographs, No.36. London: Charles Griffin’s and Co. Oosterhaven, J., and E. C. Van Der Knijff 1988 On the Economic Imnacts of Recreation and Tourism: The Innut-Outuut A 1 Approach. Built Environment 13(2):96-108. Tiebout, Charles 1969 An Empirical Input-Output Projection Model: The State of Washington 1980. The Review of Economics and Statistics LI(3):334-340. Victor, P. 1972 Pollution: Economy and the Environment: Toronto: University of Toronto Press. Wanhill, S. R. C. 1987 Making Tourism Work. Inaugural Lecture, University of Surrey, England. Zacharatos, P. 1986 Tourist Consumption. (In Greek) Athens, Greece: KEPE. Submitted 16 August 1990 Revised version submitted 26 January Accepted 11 February 1991 Refereed anonymously Coordinating Editor: Abraham Pizam
1991