Impact of Inflation on Tourism Industry: A Quantitative and Qualitative Research

Foundation Year
Research Project
(MGBBT0FYP)

Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY..................................................................................................................................2
Quantitative research on inflation................................................................................................2
Qualitative research on Inflation.................................................................................................5
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7
APPENDIX......................................................................................................................................8
Gantt Chart...................................................................................................................................8

INTRODUCTION
In the global market economy, the prices of goods and services can never be assigned a
fixed variable as both these market forces keep changing and fluctuating over time as prices can
both increase and decrease over time (Agénor and da Silva, 2019). When it comes to the broad
and gradual increase in price in an economy in a way in which the same amount of products
which could be brought before from a unit of the currency is no longer affordable, it is termed as
inflation. For example, if the amount of eatables one could purchase with $5 five years ago is
priced at $15 currently, the economy can be said to be under inflation. Inflation in broad terms
can be referred as the reduction in the purchasing power of the individuals in an economy over a
given period of time along with the consequent depreciation of the economic currency
consequently. There are various events which can trigger inflation in an economy over a given
period of time which broadly result in two main types of inflation termed by economists and
researchers as demand-pull inflation and cost-push inflation (Jaravel, 2021). The demand-pull
inflation happens during events wherein economy is close to full employment and further
increase in demand leads to similar increases in prices and main factors which contribute to this
type of inflation are cut in interest rates and increase in money supply. On the other hand, cost-
push inflation happens when firms are subjected to increase in their costing and then they push
the resultant costs onto the customers in the form of a product hike. This report will conduct a
research on the topic of “What are the typical impacts that inflation can have on the tourism
industry and what solutions, to ease the negative impacts, can be implemented?”. The main aims
and objectives of the research have been developed and listed below.
Aims
 To study the definition and process related to inflation and its impact on the tourism
sector
 To identify the ramification of negative impacts of inflation on the tourism sector
Objectives
 To analyse the way in which inflation has impacted the tourism industry
 To highlight both positive and negative impacts of inflation on the tourism industry
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