From Leakage to Crowdsourcing: A Model for Enhancing the Participation of Local Firms

Abstract

Tourism is a critical part of the economy of any country. This is essentially because in addition to being the world’s largest industry, tourism also has an important multiplier effect on other industries. However, not all tourism revenue remains in the local region, and for this reason, the concept of leakage becomes critical. Leakage studies the amount of revenue generated by tourists which does not stay in the destination country. This phenomenon occurs especially in developing countries, where lower local industrial development increases dependence on foreign countries. Therefore, the second part of the paper highlights the need to implement new business models in order to minimise leakage. For many authors, the best way to reduce the impact of leakage on the economy of different companies in a region is by enhancing linkages between local companies. The main concept in this case is to achieve the participation of the community. In this vein, one of the most important activities being used by firms is crowdsourcing, an activity defined as taking a specific task and outsourcing it to a large group of people via the Internet through an open call. This study delves into the concept of crowdsourcing presented as a technique for reducing leakage with the aim not only of increasing the satisfaction of employees and customers but also building a new business model that empowers local economies by improving their entrepreneurial environment and helps hotels to improve their profitability.