This article is aimed to address the positive effects of the tourism sector on economic development of underdeveloped and developing countries, which are mainly depending on increased exports through the service sector, where tourism plays a crucial role. It will be explained within the framework of circular and cumulative causation concept that tourism can raise living standards and economic development in these countries. The impact of exporting services in international trade on economic growth and hence on economic development can manifest themselves through employment created, market and rising incomes, and foreign exchange inflows. Moreover, it cannot be ignored the gains of tourism sector on decreasing the regional imbalances in a given country.
Key words: Development, tourism, export, service. JEL Codes: Z30, Z32, F63. Article Language: EnglishTurkish
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