Abstract

This paper examines the ways in which productivity in tourism businesses can be increased by studying the roles of changes in physical capital, human capital, innovation, and the competitive environment. Comprehensive results are obtained by using questionnaire-based interviews, business survey data analysis, and computable general equilibrium modeling. The results demonstrate the positive contribution that each of the productivity drivers can make to improving efficiency and welfare, notably increases in human capital and innovation. They also indicate that a combined strategy incorporating all of the drivers is more effective than independently formulated policies. Government organizations can collaborate to assist productivity increases, with specifically tailored measures for small businesses.