This is the simplest form of how many times money spent by a tourist circulate in a country's economy.

This effect of tourism spending is experienced by the providers of tourist goods and services and generating income for various economic agents.

In 1930's, this British Economist introduced the concept of multiplier effect in economics.

This refers to a type of leakage where the resources collected by the government through direct and indirect taxes leave circulation, reducing the purchasing power of individuals and businesses.

When the multiplier effects continues, its impact weakens, and money eventually "leaks" from the economy.

There are 3 types of leakages: taxes, savings, imports.

The indirect effect of tourism spending can be observed when business owners receive profits, workers receive wages, and the government receive taxes levied on the sale of goods and services.

Due to the international nature of tourism industry, along with the world becoming increasingly globalized and monopolized by the most successful multinational corporations (MNCs), economic leakage is becoming more and more prevalent.

The revenue generated by outbound tourism flowing into a country, region, or location injects new resources into the economy.