The Multiplier Effect
Tourists bring new money into the economy of the place they are
visiting, and this has effects beyond the original expenditures.
When a tourist spends money to travel, to stay in a hotel, or to eat
in a restaurant, that money recycled by those businesses to
purchase more goods, thereby generating further use of the money.
In addition, employees of businesses who serve tourists spend a
higher proportion of their money locally on various goods and
services.
This chain reaction, called the multiplier effect.