Effects of Local Public Investment into Infrastructure for Tourism: The Example of Saxony

The mass of investments into infrastructure for tourism in the so-called “New States” (Neue Länder) of the Federal Republic of Germany after 1990 was huge. They were aimed to the maintenance and recovery, respectively of competitiveness of traditional destinations, as well as to promote service-oriented structural change in industrial wastelands. A big part of these investments was supported by funds of the so called “Joint Task for Improving the Regional Economic Structure”. We analyse the effects of local public investment into infrastructure for tourism supported by investment grants on the local employment in accommodation and food service activities in the state of Saxony. The results provide evidence for correlations between special types of investment in the time period 2000–2007 and the development of employment in hospitality industry. However, this is subject to some requirements, such as the existence of complementary factors, or an existing regional touristic tradition as well.

04. July 2011

Authors Albrecht Kauffmann

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