TOUR326: Analysis of Corruption and Bribery in the Tourism Sector

This report delves into the pervasive issues of corruption and bribery within the global tourism industry. It begins by highlighting the industry's significant role in economic development and the creation of employment opportunities. The study investigates the negative impacts of corruption, including its...Read More

Ethics in Tourism

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Introduction
The tourism industry is a fast developing phenomenon in both developed as well as
developing countries across the world. It is now a globalised business sector that contributes
greatly towards income generation, creation of employment opportunities, exploration of the
various variables of development in a nation, etc. Tourism is based on displacement activities
which involve people getting away from their homes to visit another region with a preferably
different social and cultural background for various purposes’ including business, leisure or any
other personal means. Tourism industry is somewhat very similar to a phenomenon which is
responsible or packaging, promoting and delivering travel and care for those visitors who wish to
travel to another region and experience something fresh and innovative which would serve as a
psychological breather in their routine lives.
With more and more people gaining access to disposable incomes, there seems to have been
a tourism revolution which has encouraged both government as well as private business ventures
to utilize the new opportunities presented by the tourism industry and optimize the chance to
attract outsiders to one’s country while using the already existing cultural ethos as a profit
making system. However, in capitalist initiatives like this, the impacts of tourism industry are
bound to reflect upon the society, economy as well as the environment. In this study, we aim to
specifically study the emergence of social evils like corruption and bribery in the tourism
industry and what challenges they pose to the industry’s functioning as a whole.

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Effects of Corruption on Tourism
According to various studies conducted through the course of time, corruption has been
as a factor which affects tourism both positively as well as negatively. Since there are so many
stakeholders within the tourism industry, it is difficult to categorize everyone into a
homogeneous interest group. Tourism is a definite advantage for business enthusiasts as it
creates profits and increases foreign exchange which ultimately ends up in boosting the economy
as a whole (Poprawe, 2015). Also, psychologists argue that bribery positively impacts workers
because when they realize that they would get access to bribed money, they tend to work harder
in order to get more money (Saha and Yap, 2013). Other scholars say that corruption can indeed
be beneficial to the industry by speeding long drawn out processes and avoiding the strict
guidelines imposed by the government in order to facilitate better entrepreneurial activities.
However, upon further studies it can be noted that corruption has more obvious negative
effects on the functioning of the industry. Contrary to the logic presented by Saha and Yap, it has
been found that people generally tend to work slower than usual and become less productive
when they receive bribes because they garner expectations of receiving more bribes in the future
as well (Saha and Yap, 2014). Corruption negatively affects the experiences of tourists and thus
increases the number of risks that they have to undertake. Corruption also facilitates the creation
of a bad reputation for the tourist destination such that tourists that form a bad perception of the
place may contribute towards the decreasing popularity of the tourist destination. For instance, a
person wanting to make a visit to India may not go through with his plans only because he is
aware that he would have to face the issues of corruption and bribery. Corruption damages the
very foundations on which the whole industry runs upon. Corrupt governments may derail
resources which are meant to be allotted to the tourism sector alone. Perhaps, a corrupt
government may refuse to recognize tourism industry as a viable and lucrative source of income
and thus not address the significant issues that impact the industry’s growth. For example,
corrupt governments in Kenya have perpetually refused to deal with the environmental problems

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within the country and this has created huge losses for Kenya’s ecotourism industry (Yap &
Saha, 2013)Corrupt nations are also politically unstable and hence do not come off as attractive
options for investors who are looking to enhance a nation’s tourism sector through sizeable
investments.
Diversion of the funds that are dedicated towards the infrastructure and growth of the
tourism industry also causes hindrance in its overall development. For instance, the elite classes
in Belize have successfully used the tourism industry’s resources for their own personal gains in
order to pursue individualistic goals including illegal activities as well (Duffy, 2000). Most
importantly, it is a country’s public image that tourists are most drawn towards. Corruption and
bribery hampers this very image, thus affecting the number of potential consumers of the market
and increasing the uncertainty of tourists (Demir & Gozgor, 2017).
On the basis of empirical studies conducted by Poprawe, it was seen that a significant
decrease in the perceived levels of bribery leads to an increase in the development of tourism
sector sales. She concludes that corruption indeed has a negative impact on tourism. This impact
may also vary from country to country depending upon the political-legal setup of the nation. For
instance, in a democratically elected government, an organized committee shall be set up to look
after the requirements of the tourism sector and the administrative machinery may be used to
counter any corrupt forces. However, in non-democratic countries usually witness little to no
effect of corruption and bribery on tourist inflow (Das and Dirienzo, 2010) Moreover, there is a
difference in the way that corruption and bribery is perceived in different countries. A tourist
belonging to the US may not be familiar with the ways of undercover functioning practiced in
India and thus may be unaware of when and how he is getting involved in wrongful activities
like corruption and bribery. Bribery is considered to be a serious offence in the US and
companies face great pressure to hide it but corruption may just be a fabric of life in other
countries where governments have a more pragmatic and practical view of bribery. This denotes
the cross cultural code of ethics across different countries through the course of time.

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 Yellow Tourism – The major goal of this inaugural conference, which was first
held in April 2017 in Corfu, was to produce a multifaceted interdisciplinary
approach to the issue of corruption in tourism while simultaneously trying to
implement a global network of tourism academicians and researchers who are
well versed within this sphere.
 Inculcating Education – Efforts must be put to modernize the curriculum of
schools and universities to make them in sync with societal values and imbibe a
sense of holistic development for the future generations such that they are able to
see the shortcomings of social evils like bribery and misrepresentation (Li et al,
2017) .
 Culture of Integrity – Apart from encouraging knowledge acquisition, creating a
culture of integrity is essential as it fosters professionalism and genuine
performance standards along with applying the importance of playing by the rules
and following principles of authenticity (Guiso et al, 2015).
 Accountability – For any society to counter corruption there must be a few
mechanisms to ensure accountability of the masses. This would ensure that
corrupt ways of carrying out activities is completely discarded. This demand for
accountability must be sustained through political institutions and certain essential
spokespersons like civil servants, political leaders and private actors.
Conclusion
It is now universally accepted that corruption is a major constraint to social and economic
growth of any sector that diverts essential resources and creates obstructions in the path of
further development. Brand image and reputation are of prime importance to the success of the
tourism industry in any country across the world as external reputation becomes the most

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essential advertisement of the business industry. Steps must be taken by individual country
governments as well as international organizations like the World Tourism Organization in order
to mitigate the problems of corruption and bribery. The need for a real transformation has been
revalidated through means such as ‘The Future We Want’ outcome paper published by the UN
Conference on Sustainable Development, Declaration on the Rule of Law discussed at the high
level meeting of the UN General Assembly in September 2012, the Salvador Declaration which
was adopted by the Twelfth United Nations Congress on Crime Prevention and Criminal Justice,
etc. Certain notable factors are presented below which can lead to the implantation of concrete
steps towards achieving sustainable and genuine development goals for the tourism industry.

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References
Das, J., & Dirienzo, C. (2010). Tourism competitiveness and corruption: A cross-country
analysis. Tourism Economics, 16(3), 477-492.
Demir, E., & Gozgor, G. (2017). What about relative corruption? The impact of the relative
corruption on the inbound tourism to Turkey. International Journal of Tourism
Research, 19(3), 358-366
Guiso, L., Sapienza, P., & Zingales, L. (2015). The value of corporate culture. Journal of
Financial Economics, 117(1), 60-76.
Li, Y., Hu, C., Huang, C., & Duan, L. (2017). The concept of smart tourism in the context of
tourism information services. Tourism Management, 58, 293-300.
Poprawe, M. (2015). A panel data analysis of the effect of corruption on tourism. Applied
Economics, 47(23), 2399-2412.
Saha, S., & Yap, G. (2014). The moderation effects of political instability and terrorism on
tourism development: A cross-country panel analysis. Journal of Travel Research, 53(4),
509-521.