An industry-related spillover analysis of the impact of Chinese tourists on the Taiwanese economy

In 2008 the Taiwanese government permitted tourists to arrive from the Chinese mainland, and since that period the numbers of Chinese tourists have increased to approach 2 million by late 2012. The motivation for this policy change was partly economic, and this research note employs an industry-related spillover model and employment-created model to examine the economic impact of Chinese inbound tourists on the additional numbers of persons employed, and to investigate the extent of the effects on the tourism related industries. It is concluded that by 2011, the economic spillover effects for the retail sector and accommodations services sector were US$773.49 million and US$438.43 million, respectively. The total spillover effects of US$7617 million accounted for 0.183% of Taiwanʹs GDP.