The Tourism Development–Quality of Life Nexus in a Small Island Destination

Abstract

Tourism development (TD) and quality of life (QoL) have been studied mostly from the perspective of how TD affects QoL, but the inverse relationship is less widely researched. Understanding this interrelationship will broaden the definition and goals of development, and will help shifting the debate from an income perspective to a QoL standpoint. This study assesses the linkages between TD, QoL, and economic growth for the island of Aruba. The study contributes to the literature by improving the understanding of the nature of the relationship between TD and QoL, by advancing the theory-building process. The methodology involves multivariate cointegration analyses and Granger causality testing. The results confirm the two-way direct relationship between TD and QoL, with proactive roles for both direct and indirect relationships. The findings highlight the need for recognizing the importance of QoL in determining TD, and understanding the workings of TD and economic growth on QoL dimensions.