In their publication 'White Paper No. 3' The American Academy of Leisure Sciences claims that leisure is becoming the new centre of America's economy. The authors initially note that 'identifying leisure's economic importance is difficult' and that it is 'hard even to find the word "leisure" in government economic statistics'. The main part of the report then goes on to provide an insight into the contribution of leisure to the US economy. In terms of leisure spending the report initially considers recreation. 'The Department of Commerce defines recreation spending to include spending on home electronics, radio and television, music, entertainment, sporting goods, amusements, home gardening, toys, books and magazines, and recreation equipment like boats, motor homes and bicycles. In 1990 consumers spent US $280 billion on these recreational goods and services, constituting 7 per cent of all consumer spending. This is 3 times what consumers spent for new cars in 1990.'

However the report notes that 'US $280 billion is only a small part of all leisure spending' and that 'the majority of leisure spending is classified elsewhere'. It notes that much of spending under general categories such as transportation, housing, clothing and food can be attributed to leisure uses. 'Add all of this up' say the authors 'and leisure easily accounts for over US $1 trillion or about a third of all consumer spending ... this makes leisure America's number one economic activity.'

Turning to tourism, the report quotes Robert Crandall, Chairman of American Airlines, who reckons that 'the US's top three industries ... are tourism with US $621 billion in spending, health care with US $604 billion and education with US $331 billion.' In terms of jobs the report notes that 'Crandall claims that travel and tourism employs 9 million people in the US'. It adds that leisure is responsible for '25 million jobs about a quarter of all jobs in 1990'. What makes particularly interesting reading is the comparisons that the report makes with other sectors of the US economy. For example it notes that 'depending on which measure of economic importance you choose to accept, leisure is between 5 and 20 times the size of the automobile industry in the US'. Despite its importance though the authors claim that the significance of leisure to the economy is often overlooked. One reason they attribute for this is that government statistics are slow to catch up with and mirror changes in the economy. Because of this, there are detailed statistics available for example on agricultural and automobile production but it is still difficult to find detailed or aggregate statistics on the contribution of recreation, leisure and tourism.

Source: Adapted from White Paper No. 3: Leisure: The New Center of the Economy? published by The Academy of Leisure Sciences (www.academyofleisuresciences.org).

a)What kind of jobs are provided in recreation, leisure and tourism?

b)How might these activities affect US imports and exports?

c)Explain:

i.How the US market economy works to produce changing patterns of output of automobiles, agriculture and leisure?

ii.What are the main determinants of the level of outputs?

iii.How the 'allocative mechanism' of the USA differs from that in Cuba?

d)Are there any negative economic impacts of recreation, leisure and tourism industries?

e)How significant are recreation, leisure and tourism industries to the economy of the country where you are studying?

f)How would you expect the economic significance of leisure industries to differ between the USA, the UK, Australia, India, Saudi Arabia and Nepal?