Leakage Effect - Reducing Leakage

Reducing Leakage

For many countries, some sources of leakage are unavoidable. Foreign-owned hotels and airlines are necessary for all but the most established of tourism industries. However, encouragement of domestic involvement in a country's tourism industry may reduce leakage in the long run. Currently, the most popular measure is restrictions on spending. Countries may limit the use of foreign currency within their borders, reducing the effect of transfer pricing (see above). Many countries require visitors to have a certain amount of money before entering, as well.

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