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Issues in Tourism Event
Economic Impact Studies:
The Case of the Albuquerque
International Balloon Fiesta
Yingmiao Yu & Douglas Michele Turco
Published online: 29 Mar 2010.
To cite this article: Yingmiao Yu & Douglas Michele Turco (2000) Issues in Tourism
Event Economic Impact Studies: The Case of the Albuquerque International
Balloon Fiesta, Current Issues in Tourism, 3:2, 138-149
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Issues in Tourism Event Economic Impact
Studies: The Case of the Albuquerque
International Balloon Fiesta
Yingmiao Yu
Professor of Tourism Studies, Providence University, Taiwan
Douglas Michele Turco
Associate Professor in the Department of HPER, Illinois State University, USA
Several methodological issues have emerged from the economic analysis of tourism
attractions, including errors in sampling and analysis, misrepresentation of these
issues, the application of a refinsed researchmethodology is described to measure the
spatialdistribution of visitor expenditures and economic impacts attributedto a stated
tourism attraction. The 1995 Kodak Albuquerque International Balloon Fiesta (AIBF),
consideredthe largestballooning event in the world, wasused asthe focal attractionfor
this study. Direct, indirect, and induced economic effects based on the variables of
output, income, and employment were examined using IMPLAN, an econometric
model first developed by the United States Department of Agriculture Forest Service.
Detailed analyses on multiplier effects, linkages, and leakeage attributed to the event
are presentedin the results and discussion sections. Discussion and recommendations
based upon the study may provide a clearer picture of the consequences of method-
ological choices researchersmake when assessingthe economic impactsof stagedtour-
ism attractions.
Introduction
Studies of the economic impact of tourism or recreation activities started in the
1960s and have since attracted the attention of many researchers (Johnson &
Moore, 1993; Kanters & Botkin, 1992;Mescon & Vozikis, 1985;Mules & McDonald,
1994; Simmons & Urquhart, 1994; Turco, 1995; Vert, 1978; West 1993; Yardley et al.,
1990). Several methodological issues have emerged from this research area
(
Crompton & McKay, 1994), including errors in sampling and analysis, misrepre-
sentation of results, and the appropriate use (or misuse) of multipliers (Archer,
984).
The majority of previous studies have focused on only assessing the total
1
economic impact in terms of output, income, and number of jobs generated by a
specific tourist or recreation activity (Ruiz et al., 1994; Vert, 1978). Overemphasis
on presentation of the total impact, rather than on interpretation of the resulting
estimates and description of the application limitations, has often resulted in
misunderstanding of the study results. Moreover, some researchers and destina-
tion marketers have used economic impact figures to justify or promote the
tourism activities. As a consequence, these studies provide little information
for improved planning, management, and development of staged tourism
attractions.
Several economic impact studies of staged tourism attractionshave neglected
to differentiate between the direct, indirect and induced effects. The analysis of
1
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©2000 Y. Yu & D.M. Turco
Vol. 3, No. 2, 2000
Current Issues in Tourism
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Issues in Tourism Event Economic Impact Studies

Issues in Tourism Event Economic Impact Studies
139
multiplier effects (i.e. the direct, indirect and induced effect) helps to identify the
effects of change on each industry caused by a specific activity or activities. The
indirect effect is the measurement of backward linkages of a given industry to
local input sources; it denotes linkages to local input suppliers. The induced
effect indicates the levels of valueadded and income generated per unit of indus-
try output. The larger the export, the smaller the indirect effect, while large
induced effects contribute to large total multipliers for the high value-added
export-production industries (Ruitz, 1994). To know the economic potential of a
staged tourism attraction, spatial questions of how and to what extent money
flows throughout and outside the local economy need to be answered.
The misuse of multipliers is not the sole cause of inaccurate results in
economic impact research. Uncritical acceptance of certain questionable
assumptions can also lead to unreliable estimates and misinterpretation of
economic impact of a special event. One of these issues is the tendency to exclude
the expenditures of event visitors who travel for reasons other than to attend the
event from the economic impact assessment. It is assumed that they would visit
the localcommunity even if the festival did not occur, and their expenditures are
therefore not included in economic impact calculation. However, it must be kept
in mind that in some cases secondary visitors, those who state their primary
purpose for visiting is not the event, purposely time their trips to coincide with
the special event. In this case, it is unknown whether they extend their trips or
increase their spending in the local area because of the event. However, their
spending on the event grounds should be considered new money to the local
area because this portion of their expenditures was expected and included in
their travel budget. In other words, visiting the event grounds is not likely to
cause a reduction in their spending in the local area during their trips. Recently,
analysts have included spending by area residents within an economy that
would haveoccurred locally in the absence ofthe event. This effect, called import
substitution, can be a significant component of overall economic impact, and
may be fully as large as the traditional or primary expenditures generated by
visitor spending into the area (Cobb & Weinberg, 1993).
In regional economic impact studies, researchers have tended to exclude local
resident expenditures from their impact estimates (Dawson et al., 1993; Johnson
&
Sullivan, 1993; Pedersen, 1990). It is suggested that only visitor expenditures
generate new money for the study area, and therefore thatonlythis portion ofthe
expenditures should be calculated in the economic impact. It is usually assumed
that if residents had not spent money at the event, they would have spent it later
by purchasing other products or services in the local area. However, a special
event may entice residents to spend their money locally rather than outside the
economy. This part of local resident income would otherwise vacate the region.
As this portion of retained income is attributable to the special event, excluding
these expenditures may underestimate its economic impact.
Despite the many efforts to estimate the economic impact of staged tourism
attractions, few studies have examined the spatial distribution of visitor expen-
ditures (Long & Perdue, 1990; Turco, 1992). Spatial distribution of economic
impact refers to the geographic locationofdirect and secondaryeconomic effects
generated by the visitors’ expenditures within and outside of the event. Direct
effects are geographically distributed because special event visitors often make

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Current Issues in Tourism
purchases during all phases of a trip: at home, en route, and at or near the event
site. Indirect impact is likely to take place far from the location of the direct effect
due to interregional industry linkages (Turco, 1992). Without considering the
spatial distribution of visitors’expenditures, the resulting impact will be overes-
timated. To address the spatial distribution issue in the economic impact assess-
ment, the local area (examining area) needs to be defined, and visitor
expenditures tracked geographically.
Previous economic impacts of staged tourism attractions were understood on
the basis of total output, income, and employment. Little is known of an event’s
significance to individual industries within a designated economy. Without
understanding the impact distribution in the local economy, local businesses are
unawareofthetotalimpact, due to thefestival, oneachindividualindustry. There-
fore, it is importanttoknow thedistributionoftheimpactsamonglocalindustries.
The purpose of this study was to measure the spatial distribution of visitor
expenditures attributed to a staged tourism attraction, and to estimate the
economic impactsresulting from those expenditures. The 1995KodakAlbuquer-
que International Balloon Fiesta (AIBF), considered the largest ballooning event
in the world, was used as the tourism attraction for this study. Data from this
study were proprietary in nature and not released by the AIBF until 1998. Direct,
indirect, and induced economic effects based on the variables of output, income,
and employment were examined using IMPLAN, an econometric model first
developed by the United States Department of Agriculture Forest Service. The
distribution of economic impacts among local industries was also determined.
Detailed analyses of multiplier effects, linkages, and leakage attributed to the
event are presented in the results and discussion sections of this paper. Study
results and discussions may provide a clearer picture of the many options
researchers have when estimating the economic impacts of staged tourism
attractions, and the consequences of their choices.
Methodology
The 25th Annual Kodak Albuquerque International Balloon Fiesta was held
on a 77 acre park leased from the City of Albuquerque, from 7–15 October 1995.
Albuquerque is located in Bernalillo County, New Mexico. The event featured a
musical concert, four mass ascensions,balloon glow, daily balloon competitions,
and sales of food, beverages, and gift items.
Turco’s (1992) visitor survey was used to collect visitor geographic and demo-
graphic information, and to determine their travel patterns and expenditures. A
questionnaire was designed, and personal interviews were undertaken on the
festival grounds by a group of trained interviewers. The IMPLAN model was
utilised to estimate the total economic impacts of expenditures made by the
balloon festival visitors.
To represent the appropriate daily proportionof thetotalvisitorattendancein
the BalloonFiesta, the sampling of days, times, and daily sample size for the 1995
AIBF study was systematically stratified to match Balloon Fiesta attendance
figures over the past three years. Two-hour sampling periods were randomly
selected from all possible operation hours of the festival. The number of inter-
viewers for each sampling period was determined by the sample size. This

Issues in Tourism Event Economic Impact Studies
141
sampling strategy reduces the possibility of conducting a disproportionate
number of interviews at participation times or days when the proportion of a
particular group of visitors tends to be high. The total sample size (n = 750) was
determined by considering an acceptable precision level (+ 3.5%) while also
balancing human and financial resource requirements.
The expenditure categorieslisted in thequestionnaire included visitor’s major
expenditures made at the festival grounds as well as in the local area. The expen-
diture of visiting group instead of the individual visitor was collected in this
study. On-site spending items were categorised as food and beverages, enter-
tainment, souvenirs, and film, while off-site purchasing items included lodging,
meal, gasoline, retail shopping, public transport, film, and entertainment. To
capture the spatial distribution of the total economic impact generated by
balloonfestivalvisitors’expenditures, thevisitorswere asked only to report their
spending on and off the event grounds in Albuquerque.
Interviewers were instructed to approach every 11th visitor (age 16 years or
older) during five of the nine days of the Balloon Fiesta and to ask the spectators
to participate in the survey. A qualifying question was asked to ensure that spec-
tators were only interviewed once. Spectators interviewed earlier were politely
excluded from the study by interviewers. An adult or head of a household was
selected for the interviews, as s/he would have better knowledge about the
group’s expenditures on the trip.
The IMPLAN (Impact Analysis for PLANning) input-output model was
selected from other models to analyse the total economic impact of the expendi-
tures generated by event visitors. A comparison of three I-O models (REMI-II,
IMPLAN, and REMI) conducted by Rickmanand Schwer (1995)found no signifi-
cant difference in multipliers after benchmarking the models, although the
models differ substantially. They conclude that the ‘ready-to-use’ I-O-based
models offer an appropriate format for conducting the indirect effects as part of
an economic impact study.
A regional IMPLAN model was developed for Bernalillo County using 1992
economic data. In order to be consistent with the IMPLAN database, the 1995
expenditures were adjusted to 1992 dollars using producer price deflators.
Visitors’ expenditures collected from the visitor survey were submitted to the
IMPLAN model, with a list of 528industries, to constructa regional I/O modelof
Bernalillo County and to estimate the total economic impact on the city of Albu-
querque. The reports generated from the IMPLAN impact analysis were used to
assess the economic impacts and to analyse the inter-industry relationships.
Several regional multipliers and some other reports were also produced by the
IMPLAN model to analyse the local economic structure.
Results and Discussion
Total of on-site and off-site visitors’ expenditures
In this study, the economic impacts caused by on-site and off-site visitor
expenditures were assessed separately. The visitorexpenditure information was
collected based on the travel party instead of the individual visitor. To obtain
visitor expenditure totals, the number of visitor groups was first calculated by
dividing the total event attendance by the average visitor group size and

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Current Issues in Tourism
Table 1 Off-site expenditures attributable to the event
Expenditure item
Lodging
Food
Gasoline
Shopping
Transport
Entertainment
Film
Total amount
11,043,157.00
10,682,917.00
2,468,544.60
8,743,925.40
334,881.10
2,219,979.00
668,245.20
Total
39,175,649.00
Table 2 On-site expenditures attributable to the event (after adjustment)
Expenditure item
Food
Entertainment
Film
Total amount
2,527,031
907,231
382,250
Gifts
Total
3,944,522
7,761,034
frequency of attendance. The number of visitor groups can be derived by the
equation VG = T/G/F, where VG = number of visitor groups, T = total atten-
dance, G = group size, and F = frequency of attendance. Based on attendance,
visitor group size, and frequency of attendance, a total of 55,229 visitor groups
attended the event. Visitor groups averaged 4.5 persons in size, stayed in Albu-
querque 4.4 nights, and attended the event 2.5 days.
Referring to the economic impact resulting from visitors’ off-site expendi-
tures, only primary visitors’ expenditures were included in the impact analysis.
Regarding the impact caused by visitors’ on-site expenditures, two other visitor
groups’ expenditures, besides the primary visitor groups, were added to the
impact analysisto calculatetheimpact properly. The first group wasthenonlocal
visitors who planned their trips to coincide with the balloon festival. The second
group was composed of local residents who stated that they would have trav-
elled outside of the community if the event had not occurred. Table 1 shows that
the primary visitor groups spent $39.18 million in the city of Albuquerque. After
theadjustment, thefestivalvisitorsgenerated $7.76millionoftotalon-siteexpen-
ditures (see Table 2). The above off-site and on-site expenditures were then used
to measure the total economic impact.
Economic impact resulting from visitors’ off-site and on-site
expenditures
The results show thatvisitors’off-site expenditures resulted in $54.7million of
total industry output, $31.32 million of total income, and 1236 jobs in the local
community. Among $54.7 million of output, approximately $26.6 million was
generated from direct effect, $23 million from the induced effect, and only $5.2
from the indirect effect (see Tables 3, 4, & 5).
On-site visitor expenditures generated $9.77 million of total output, $5.59

Issues in Tourism Event Economic Impact Studies
143
Table 3 Changes in output ($m)(off-site expenditures) due to AIBF, Bernalillo
County, New Mexico, 1995
Direct
6.86
4.21
4.60
1.99
0.00
1.71
0.00
0.40
1.45
1.40
1.46
0.00
1.32
0.00
0.31
0.88
26.58
Indirect Induced
Total
7.13
5.56
5.24
2.65
2.24
2.22
2.03
1.72
1.71
1.69
1.66
1.50
1.46
1.39
1.17
15.34
54.70
Hotels and lodging places
Eating and drinking
Food stores
Automobile repair and Services
Owner-occupied dwellings
General merchandise stores
Real estate
0.04
0.02
0.04
0.10
0.00
0.03
0.62
0.32
0.06
0.02
0.00
0.00
0.05
0.00
0.04
3.84
5.16
0.23
1.33
0.60
0.56
2.24
0.49
1.42
1.00
0.20
0.27
0.20
1.50
0.09
1.39
0.83
10.62
22.96
Wholesale trade
Apparel made from purchased materials
Apparel and accessory stores
Amusement and recreation services
Doctors and dentists
Automobile rental and leasing
Hospitals
Miscellaneous retail
Other sectors
Total
Table 4 Changes in income ($m)(off-site expenditures) due to AIBF, Bernalillo
County, New Mexico, 1995
Direct
5.10
3.36
2.16
1.11
0.00
0.00
0.00
0.00
0.74
0.77
0.19
0.60
0.63
0.016
0.44
0.41
15.65
Indirect Induced
Total
5.30
3.83
2.85
1.44
1.38
1.23
1.00
0.92
0.89
0.88
0.83
0.80
0.74
0.60
0.48
8.16
31.32
Hotels and lodging places
Food stores
Eating and drinking
General merchandise stores
Owner-occupied dwellings
Doctors and dentists
Hospitals
0.03
0.03
0.01
0.02
0.00
0.00
0.00
0.28
0.01
0.00
0.15
0.03
0.03
0.02
0.02
2.10
2.71
0.17
0.44
0.68
0.32
1.38
1.23
1.00
0.64
0.15
0.11
0.48
0.17
0.09
0.42
0.03
5.65
12.95
Real estate
Apparel and accessory stores
Amusement and recreation services
Wholesale trade
Automobile repair and services
Apparel made from purchased materials
Miscellaneous retail
Automobile rental and leasing
Other sectors
Total

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Current Issues in Tourism
Table 5 Changes in employment (off-site expenditures) due to AIBF, Bernalillo
County, New Mexico, 1995
Direct
218
156
142
59
46
42
10
0
2
6
18
0
0
Indirect Induced
Total
226
206
162
76
52
51
39
27
27
24
24
21
20
18
0
Hotels and lodging places
Eating and drinking
Food stores
General merchandise stores
Amusement and recreation services
Apparel and accessory stores
Miscellaneous retail
1
1
1
1
0
7
49
19
17
6
1
8
1
0
1
28
27
3
Hospitals
Apparel made from purchased materials
Wholesale trade
Automobile repair and services
Real estate
Doctors and dentists
Automobile rental and leasing
Owner-occupied dwellings
Other sectors
4
1
14
5
7
0
1
14
20
1
16
0
14
750
0
0
65
84
182
402
261
1236
Total
Table 6 Total impact of on-site expenditures after adjustment
Direct
4.66
2.72
Indirect Induced
Total
9.77
5.59
Total Output ($m)
Total Income ($m)
0.91
0.49
4.21
2.37
Employment (number of jobs)
140
14
73
228
million of totalincome, and 228 jobs in the local community (see Table 6). Among
9.77 million of total output, $6.49 million was produced on-site from primary
$
visitor expenditures. The balance of output was generated by secondary visitor
expenditures, and by expenditures from residents who remained in Albuquer-
que to attend the event rather than travelling outside the area. In this study, 19%
of the non-local visitors planned their trips to coincide with the balloon festival.
They spent $1,677,649 at the festival grounds, which created a total output of
$
2.06 million and total income of $1.18 million in Albuquerque. In addition, 12%
oflocalvisitorsstatedthatthey stayed in Albuquerque to attend theballoon festi-
val ratherthan travellingoutside. This group ofvisitorsadded $927,353ofexpen-
ditures to the local community, which generated $1.23 million of output and
$
0.69 million of income.
It should be noted that, due to the difficulty in obtaining local business
records, the leakage caused by non-local vendors’ business receipts were not
considered in this study. This may lead to an overestimationof the impact result-
ing from visitor on-site expenditures. However, the overall impact of visitor
on-site expenditures may be underestimated because conservative Local
Purchase Coefficient (LPC) rates were used in the analysis. This then led to a

Issues in Tourism Event Economic Impact Studies
145
conservative economic impact estimate of visitors on-site and off-site expendi-
tures. In addition, the employment indicator in the IMPLAN model is a mix of
full-time and part-time employment. Because the majority of festival staff are
usually volunteers, the employment multiplier may not be properly applied to a
short-term event such as the Balloon Fiesta. While the tourism industry is
plagued by studies overestimating its economic impacts, underestimation is
equally as inaccurate. Limiting the scope of an economic impact study means
that the total impacts may not be known, rather only the impacts of the variables
under investigation, as was the case here.
Distribution of economic impact among local industries
Ranked in order, the sectors most affected by the event (those receiving more
than 2.0% of the total amount of output) were: (1) hotel and lodging places; (2)
eating and drinking places; (3) food stores; (4) automobile repair and services; (5)
owner-occupied dwellings; (6) general merchandise sectors; (7) real estate; (8)
wholesale trade; (9) apparel made from purchased materials; (10) apparel and
accessory stores; (11) amusement and recreation; (12) doctors and dentists; (13)
automobile rental and leasing; (14) hospitals; and (15) miscellaneous retail. The
above 15 sectors comprised 72% of the total output. The direct and secondary
economic impacts resulting from the balloon festival visitors tended to be
concentrated in the service sectors. The impact reports show that the hotel and
lodging places, eating and drinking, food stores, automobile repair and services,
and owner-occupied dwellings were the five largest output and income receiv-
ers. The significant impacts on owner-occupied dwellings, real estate, doctors
and dentists, and hospitals were mostly caused by the induced effect (the effect
from the re-spending of the households’ income). The shopping expenditures
directly produced impacts on the general merchandise stores,apparel and acces-
sory stores, wholesale trade, and miscellaneous retail sectors. Although visitors
initially injected $3.35 million into public transport, it only generated $3.01
million of total output and $1.44 million of total income to the local area. This
outcome was mainly due to the high leakage occurring in the first round of
production in the automobile rental and leasing and transportation service
sectors.
The IMPLAN Type-III multiplier, defined as the ratio of total effects (sum of
direct, indirect, and induced effects) to direct effects, was used in this study for
analysis. Multiplier effects denote the interdependency of a given industry on a
regional economy. The output multipliers suggest that the increased sales from
traditionaltourism industries such asamusement and recreationservices, eating
and drinking, and hotels and lodging places have high impact,per unit ofoutput,
on the local area (see Table 7). Conversely, transportation services and automo-
bile rental and leasing had less impact, per unit of output, on the local economy.
Food and beverages, the second largest visitors’ expenditure item, brought the
largest impact to the localeconomy. The eating and drinking industry had a high
Type-III output multiplier of 2.23, which shows its strong linkage to the local
economy. Although lodging was the largest visitor expenditure category, the
low output multiplier effect and high import propensity in the lodging sector
contributed to its high leakage. The relatively higher income multiplier rates of
eating and drinking, amusement and recreation services, automobile rental and

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Table 7 Regional multiplier: output multiplier ($m 1992)
Indirect Induced
Current Issues in Tourism
Direct
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
1.000
Total
2.334
2.276
2.225
2.223
2.175
2.040
1.967
1.807
1.775
1.774
1.739
1.693
1.641
1.523
1.142
1.823
Miscellaneous retail
Amusement and recreation services
Eating and drinking
Apparel and accessory stores
General merchandise stores
Hotels and lodging places
Food stores
0.323
0.308
0.173
0.305
0.187
0.139
0.105
0.305
0.317
0.343
0.154
0.314
0.163
0.120
0.113
0.210
1.010
0.968
1.052
0.918
0.988
0.901
0.862
0.503
0.458
0.402
0.585
0.378
0.478
0.405
0.029
0.613
Wholesale trade
arAutomobile rental and leasing
Automobile repair and services
Hospitals
Real estate
Apparel made from purchased materials
Doctors and dentists
Owner-occupied dwellings
Other sectors
Table 8 Regional multiplier: income multiplier ($m 1992)
Indirect Induced
Direct
0.510
0.528
0.512
0.528
0.304
0.329
0.649
0.485
0.451
0.433
0.743
0.730
0.724
0.819
0.615
0.606
Total
2.509
2.389
2.385
2.339
2.334
2.318
2.049
1.955
1.851
1.840
1.812
1.769
1.586
1.371
1.120
1.786
Miscellaneous retail
Amusement and recreation services
Eating and drinking
Apparel and accessory stores
Automobile repair and services
Automobile rental and leasing
General merchandise stores
Wholesale trade
0.181
0.169
0.095
0.171
0.178
0.166
0.105
0.170
0.163
0.086
0.078
0.059
0.083
0.068
0.057
0.119
0.589
0.565
0.613
0.536
0.227
0.267
0.576
0.293
0.221
0.297
0.526
0.503
0.321
0.235
0.017
0.357
Real estate
Apparel made from purchased materials
Hotels and lodging places
Food stores
Hospitals
Doctors and dentists
Owner-occupied dwellings
Other sectors
leasing, apparel and accessory stores, and general merchandise stores indicate
that more money will be generated by every dollar of direct income. Compara-
tively, hotels and lodging and food stores have a relatively small income multi-
plier effect on local economy (see Table 8).
It should be noted that the computed impacts from on-site visitor expendi-
tures are more limited compared to results from the off-site expenditures. This is
because the leakage of on-site expenditures via allied event businesses (i.e. food,

Issues in Tourism Event Economic Impact Studies
147
beverage, concession vendors, entertainers, etc.) was not considered in this
study. The residency of the vendors mainly determines the leakage of on-site
visitorexpenditures. Seven of the 59vendors were nonresidents of the Albuquer-
que area. The portion of on-site visitor expenditures received by non-local
vendors may be carried out of the local area and may constitute a significant
amount of money (Long & Perdue, 1990).
Conclusions
The total impact of a staged tourism attraction in a local economy may be
much larger than the spending associated with only attending the attraction(i.e.
admission, parking, concession receipts). The cumulative effects of visitors’
expenditures in a regional economy are mainly determined by its economic
condition. In this study, a large portion of visitor transportation expenditures
leaked out immediately at the first round of transaction, and therefore reduced
the total amount of economic impact. This leakage problem is particularly obvi-
ous in remoteand rural communities where thecurrent levels ofservice-oriented
infrastructure and industry are not adequate to capture visitor spending.
Hosting a large-scalespecial event in a rural communitymay not benefit the local
economy, because the high degree of import tendency in a rural area usually
causes high leakage and benefits other regions. Planners should first examine the
local economic resources before a staged tourism attraction is promoted as an
income generator.
For most small businesses, the interdependencies and relationships of busi-
nesses within an economy (and therefore the multiplier coefficients) are beyond
their control and influence. Granted, campaigns by economic development and
chamber of commerce offices encouraging merchants to transact with one
another and ‘buy locally’ may minimise imports and subsequent income leak-
age, but some businesses have no choice but to purchase their necessary goods
and services from suppliers outside the local economy. Nevertheless, staged
tourism events, particularly in remote areas, typically generate direct or
first-round transactions that are beneficial to local businesses. To these many
smallbusiness owners,theinitial tourismtransactionsaretheirprimary concern.
The study’s results indicate that the 1995 Albuquerque International Balloon
Fiesta benefited localbusinesses by attractingvisitors to participatein other tour-
ism or recreation activities in the local community. Primary visitors not only
made purchases at the event grounds, but also spent a large amount of money
off-site in the Albuquerque area. This indicates that a special event can elicit the
disbursement of tourism spending to other local businesses. The results also
show that, if well promoted, a special event can be a powerful strategy for boost-
ing local tourism industries. Hence, cooperationbetween festival organisers and
local tourism-related industries should be encouraged.
Recommendations
Event holders and tourism researchers seeking to measure the economic
impacts of their operations should be mindful of the methodological issues
surrounding this type of research, including the inappropriate use of multiplier
coefficients, import substitution, and failure to adjust event attendance totals to

1
48
Current Issues in Tourism
reflect repeat tourist visits. The consequences of these issues will lead to impact
figures that are inaccurate, and discredit the event organisation.
Future economic impact studies should seek to determine the portion of
secondary or coincidental visitor expenditures made in the local area due to the
staged attraction. A supplementary question is necessary, asking these visitors
whether they would have taken a trip to the local area if the attraction had not
been held. The spending made in the local area by those visitors who would not
have visited the local area without the festival should be included in the
economic impact calculation.
It was found in this study that the primary festival visitors spent an average of
4
.6 nights in Albuquerque and 3.6 nights in other areas of New Mexico. Though
thevisitors’expenditures madein areasadjacent to Albuquerque were not inves-
tigated in this study (i.e. Santa Fe, Taos, Gallup, etc.), their considerable stay in
other areas of New Mexico implies that the economic impact on the areas adjoin-
ing Albuquerque may be significant. Therefore, future studies of the spatial
distribution ofvisitors’expenditures for a staged touristattraction,particularly a
hallmark event, should consider covering a broader region.
Correspondence
Any correspondence should be directed to Dr Douglas Michele Turco, 212
McCormick Hall, Campus Box 5121, Illinois State University, Normal, IL
6
1790-5121, USA (dmturco@ilstu.edu).
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