Exporting goods is great for countries: it is a way to attract foreign currency. Exports are also fairly easy to analyze, since they are put in big crates and physically shipped through borders, where they are usually triple checked*. However, there is another way to attract foreign currency that escapes this analytical convenience. And it is a huge one. Tourism. When tourists get inside your country, you are effectively exporting something: anything that they buy. Finding out exactly what and how much you’re exporting is tricky. Some things are easy: hotels, vacation resorts, and the like. Does that cover all they buy? Probably not.
Investigating this question is what I decided to do with Ricardo Hausmann and Frank Neffke in our new CID Working Paper, Exploring the Uncharted Export: An Analysis of Tourism-Related Foreign Expenditure with International Spend Data. The paper analyzes tourism with a new and unique dataset. The MasterCard Center for Inclusive Growth endowed us with a data grant, sharing with us anonymized and aggregated transaction data giving us insights about the spend behavior of foreigners inside two countries, Colombia and the Netherlands.
The first thing to clear is the question: does tourism really matter? Tourism might be huge for some countries — Seychelles or Bahamas come to mind** — but does it matter for any other country? Using World Bank estimates — which we’ll see they are probably underestimations — we can draw tourism as the number one export of many countries. Above you see two treemaps (click on them to enlarge) showing the composition of the export basket of Zimbabwe and Spain. The larger the square the more the country makes exporting that product. Tourism would add a square larger than tobacco for Zimbabwe, and twice as big as cars for Spain. Countries make a lot of money out of tourism, so it is crucial to have a more precise way to investigate it.