Tourism Development to Enhance Resident Well-Being: A Strong Sustainability Perspective

Abstract

Tourism research must recognise recent advances in sustainability theory if it is to progress conceptually and in the policy domain. By applying the method of critical review, this paper demonstrates the relevance of the capitals approach to sustainable tourism development, with human well-being identified as the ultimate objective of the process. Distinguishing between weak and strong sustainability, a policy framework is developed to merge the capitals approach with well-being outcomes to determine the direct and indirect benefits of tourism developments to stakeholders and destination residents. Several challenges must be addressed if sustainability principles and practices are to be embedded in tourism policymaking.

1. Introduction

To achieve sustainable development globally by 2030, the United Nations has called for a partnership between private and public sector stakeholders in all destinations to achieve economic, social, and environmental objectives, for both the current and future generations [1,2]. These objectives comprise 17 sustainable development goals (SDGs). In support, the United Nations World Tourism Organisation has emphasised the substantial potential of the tourism industry to contribute, directly and indirectly, to achieving the SDGs [3].

The past decade has witnessed an increasing volume of research regarding the sustainability concept and appropriate policy and practice in both tourism and wider social science journals [4,5]. The standard definition of sustainable development is that which ‘meets the needs of the present generation without compromising the ability of future generations to meet their own needs and aspirations’ [6]. Despite the increased emphasis on sustainability as the hallmark for industry development globally, the reality is a world increasingly fixated on economic growth characterised by social and economic crises, ecosystem deterioration, social and cultural degradation, potentially catastrophic climate change, loss of biodiversity, excessive pollution, and poverty with growing inequalities of wealth and income between and within nations [7,8]. To date, industry development, including tourism development, has been exploitative and unsustainable, reflecting consumption patterns that have depleted and degraded resources faster than their replenishment, as demonstrated in many of the discussions of ‘overtourism’ [9,10].

Several issues have emerged which, although widely debated in the broader research literature, appear to be relatively neglected in tourism studies. One issue involves a growing consensus among social scientists that the primary goal of sustainable development is to enhance human well-being, currently and in the future. This implies that the ultimate goal of social policy (including tourism policy) should be to achieve human well-being [11,12,13,14]. Associated with this recognition, destinations are now being encouraged to find new ways to measure human progress that go beyond GDP [15,16] in acknowledgement that current (intra-generational) and future (inter-generational) well-being outcomes are essential to the sustainability or otherwise of alternative industry development paths. Consequently, well-being outcomes of development are receiving increased attention in an agenda of research, measurement, and policy that is formulating a substantial range of metrics of human progress [16,17]. Curiously, despite greater attention to well-being issues in tourism research generally [18,19], researchers have devoted little explicit attention either to interpreting or measuring resident well-being as essential for sustainable tourism development [20]. It is fair to say that in tourism research, sustainability and well-being are generally studied as independent subjects despite their essential interconnections.

A second issue, related to the first, is that tourism researchers in general do not seem to be fully aware that ‘sustainability’ is an essentially dynamic concept achieved by maintaining or enhancing the total stock of capital that transmits ‘well-being’ over time [21]. Given that industry development affects resident well-being through the depletion or creation of different types of capital stocks (economic, human, social, and natural), the sustainability challenge involves managing these stocks rationally for sustained intertemporal well-being [21,22,23]. Despite giving substantial attention to sustainability issues over several decades, the role of changing capital stocks as transmission mechanisms, linking current resident well-being with future resident well-being continues to be somewhat ignored in tourism research [24]. Neglecting the role of changing capital stocks as mechanisms for affecting well-being outcomes for future generations, tourism studies of ‘sustainability’ have tended to focus largely on the current effects of development projects [25].

A third issue concerns the extent to which different types of capital stocks can for substituted for one another and the consequences for sustainable development. An important question is whether sustainable development requires the total stock of capital to be maintained, with substitution allowed between various types of capitals, or whether some types contribute to well-being in a unique way that cannot be replicated by other capital stocks. In answering this question, two major positions have evolved among researchers-‘weak’ vs. ‘strong’ sustainability. Weak sustainability postulates full substitutability between capital stocks, whereas strong sustainability holds that substitutability is severely constrained by the need to maintain critical thresholds of some stocks (primarily natural capital) necessary for human existence at any level of well-being [26]. Despite being relatively neglected in the tourism research literature, the issues addressed in this debate are crucially relevant to sustainability theory and practice in any industry, particularly in tourism development.

A fourth issue concerns the notion of ‘well-being’ to be employed in tourism analysis and policy making in support of sustainable industrial development. Tourism research has typically employed subjective measures of resident (and tourist) well-being in various development studies [27]. However, to capture broader aspects of resident well-being, and to better design destination capacity and policy to support sustainable development [28], objective, as well as subjective measures, are required.

A fifth issue concerns the role of well-being measures in tourism policy formulation, implementation, and assessment. Since well-being outcomes provide more basic information for tourism decision making regarding sustainable development than standard key performance indicators that focus on impacts of growth, the question arises as how to convert standard impact measures to well-being outcomes [29]. It is argued below that tourism stakeholders should employ a ‘well-being lens’ to convert changes in the quantity and quality of capital stocks to changes in resident well-being, intra- and inter-generationally.

It is argued herein that to support more successful participation by tourism stakeholders in the effort to achieve and maintain sustainable tourism development, tourism research must acknowledge advances in sustainability theory and practice that are taking place in the social science literature. Each of the abovementioned issues will be addressed in greater detail below. The structure of this paper is as follows: first, to highlight the importance of the capitals approach, with human well-being identified as the ultimate objective of sustainable tourism development; second, to demonstrate the relevance of the distinction between weak and strong sustainability in influencing the direction of tourism development and the associated research effort; third, the paper will develop a policy framework for merging the capitalss approach with well-being outcomes to determine the direct and indirect benefit of tourism developments to stakeholders including destination residents; and, finally, the paper identifies some challenges that must be faced, and capacity increases that must be undertaken, if sustainability principles and practice are to be embedded in tourism policymaking. Given the existing gaps in tourism research, several of these challenges and initiatives to enhance destination capacity to produce well-being opportunities are yet to be addressed in any serious way.

2. The Capitals Approach to Sustainable Development

Sustainable development is an essentially dynamic concept achieved by preserving or enhancing the total stock of capital maintaining current and future ‘well-being’ [21]. The capitals approach, originating in neoclassical economic theory, analyses how changes in the quantity and quality of capital stocks affect present and future resident welfare levels [21,26,30,31]. The capacity to provide well-being, intra- and inter-generationally, is embodied in four types of capital: economic, human, social, and natural capital [16,32,33,34].

Economic (produced) capital includes tangible built assets, such as buildings and machinery, infrastructure, energy generation, water storage, telecommunications, and transportation networks and intangible, knowledge-based assets, such as software and databases and financial assets of governments, businesses, and households that fund capital formation.

Human capital includes the social and personality attributes comprising persons’ capacities to innovate and employ new technologies to produce economic value, as well as the associated knowledge, education, experience, skills, health status, and creativity to do so.

Social capital comprises the networks of social relationships among residents of a society, allowing that society to function effectively to achieve common purposes. Dimensions of social capital include shared values, social ties, and institutional arrangements, resulting in levels of trust in other persons and institutions that foster cooperation.

Natural capital comprises renewable and non-renewable resource stocks including land, freshwater, atmosphere, oceans, climate, biodiversity, and ecosystems essential to human existence and social well-being.

Opportunities for enhanced well-being of both the current and future generations of residents are dependent on changes in the quality and quantity of capital stocks at a destination. On the capitals approach, developed by neoclassical economists, the condition for sustainable development is that each generation transfers to the following generation a stock of productive capacity capable of sustaining utility per capita at a level at least that which is available to the present generation [30]. Formally, W(t) = i[Σ(Pi(t)Ki(t)], where W(t) is the economy’s wealth at time t comprising all stocks that contribute to market production, generating consumption possibilities and social welfare. Ki(t) is the economy’s stock of asset i at time t and Pi(t) its shadow (real) price. The use of prices in valuing wealth, W, implies perfect substitutability between the different stocks of capital, with relative scarcity reflected in changing prices [21].

Taking the total stock of capital K in any destination at a given time to equal Ke + Kh + Ks + Kn where Ke is economic capital, Kh is human capital, Ks is social capital and Kn is natural capital, changes in the components of the overall stock, K, can be traded- off for each other just so long as the aggregate monetary value of total stock of capital K is maintained. In simplified form,

$$\frac{\mathrm{d}K}{dt}=\frac{d\left(K_e+K_h+K_s+K_n\right)}{dt}\ge 0$$

This position is known as ‘weak sustainability’ (WS). WS involves a managerial approach to development where the services and goods provided by nature are assigned an economic value. According to the so-called ‘Hartwick Rule’, in order to maintain total wealth and achieve non-declining welfare over time, income from the depletion of non-renewable resources should be reinvested in renewable resources [30]. Sustaining well-being over time implies, at the very least, maintaining the stocks of capital necessary to support current levels of well-being into the future. On this approach, currently dominant in mainstream economics, any type of capital may be depleted provided the rents are reinvested in other forms of capital with technological progress assumed to overcome the environmental problems associated with increased production of goods and services [35].

A major problem with the WS concept is that neoclassical growth theory treats consumption as the only source of the well-being of the individuals in the economy. Thus, ‘welfare effects’ based on the narrow and ill-defined notion of ‘utility’ are treated as equivalent to ‘well-being outcomes’. However, ‘utility’ or ‘welfare’, associated with real consumption per capita or real GDP per capita, cannot be equated with the richer multi-dimensional conception of ‘well-being’ advocated by social scientists [17,36,37]. Equating well-being with preference satisfaction excludes broader shared values such as compassion, empathy, responsibilities, and equity. Homo economicus, the fundamental assumption that every individual is motivated solely by self-interest, is simply false. Human behaviour can be and is motivated by a concern for the feelings and well-being of others, including other life forms and future generations [38]. As argued elsewhere [24,39], narrow utility-based measures are unsuitable as indicators of present and future citizen well-being and thus unsuitable for tourism policy making.

3. The Case for Strong Sustainability

Proponents of strong sustainability (SS) reject the assumption of WS that technological changes enable the substitution of all natural capital by one or another type of capital, while maintaining the same level of choice in society currently and into the future [32,33]. Several types of arguments support SS, based on considerations of irreversibility, uncertainty, and the existence of ‘critical’ components of capital stock, that make a unique contribution to resident well-being. These arguments are as follows [35,40,41,42].

First, many types of natural capital providing basic life-support services through ecosystems, biodiversity, water supply, climate regulation, fertile soil, global carbon, biogeochemical cycles, and so on, are essential for human existence and well-being. Other capital stocks cannot replace several of the essential functions of natural capital. In the absence of’ natural capital, such functions would not exist on any sustained or systematic basis.

Second, economic (produced) capital is reproducible, whereas the degradation or depletion of types of natural capital that provide life-support functions may be irreversible and irreplaceable.

Third, there are many gaps in our knowledge regarding the functioning of various natural systems, including the various effects on human well-being of destroying natural capital. Based on the precautionary principle, critical threshold amounts of natural capital should be preserved to minimise the risk of such services becoming irretrievably lost.

Fourth, the present generation is uncertain of the preferences and lifestyles of future generations. To preserve options to cover uncertainties, the bequest package from present to future should contain levels of all four types of capital stocks.

Fifth, increased future consumption of varied types of goods and services cannot be regarded as an appropriate substitute for losses of natural capital. This claim finds support from an ethical perspective affirming the intrinsic value of all living entities (biocentrism) or the intrinsic value of all natural phenomena, including landscapes, mountains, forests, and lakes (ecocentrism).

These considerations support the SS view that ecosystem services and other essential functions of natural capital comprise what is called ‘critical natural capital’ that makes a unique contribution to human well-being [32,43]. The ‘criticality’ concept relates to the need to maintain various aspects of natural capital above safe minimum standards to provide ecological services essential for human existence and well-being [32,40,44]. The development process in a destination should not only preclude an overall reduction in capital stock but also require maintaining levels of certain types of stocks above established thresholds [34]. Advocates of SS claim that the only acceptable compensation rule for protecting inter-generational well-being is to maintain ‘critical’ natural capital above threshold levels, especially those functions essential for human life support and which are unique transmitters of well-being [26]. Where no specific stock level can be specified to determine the critical threshold, a probability or risk-based approach is needed [45].

The SS approach shifts the burden of proof from those who wish to preserve resources to those who seek to deplete them. A policy rule of thumb of proponents of SS is to prevent all reductions in natural capital stock below the safe minimum standard identified for each component of this stock, unless the social opportunity costs of doing so are ‘unacceptably’ high [35]. It must be noted, however, that not only are there difficulties in identifying critical levels for each type of capital stock, but it is difficult to estimate the full opportunity costs associated with any ‘develop or preserve’ decision. Determining the critical level of natural capital depends both on an understanding of the complex dynamics of socio-ecological systems and on an understanding of community values driving development processes [43]. The decisive question is ‘critical for what purpose and for whom?’ At bottom, given uncertainties over outcomes, levels of acceptable risk, and conflicting values about what comprises ‘the good life’, that is to say, the minimum threshold selected for any type of capital, will be a matter of social choice [46,47].

In contrast to the extreme positions that may be taken up regarding WS and SS, a consensual view advanced in the debate [48] suggests that destination managers should adopt a precautionary, balanced approach to tourism development. On this view, substitutability between capital types is permitted to some extent (consistent with WS), but subject to maintaining critical thresholds that recognise the existence of irreversible natural and social processes likely to reduce resident well-being over time (consistent with SS). The practicality of this position will, of course, depend on the formulation of acceptable notions of ‘criticalness’ and the measures adopted to determine threshold levels of capital stocks.

4. More Realistic Conception of Well-Being

To better design a policy to support sustainable development, we need to develop measures of well-being that go beyond narrow utility maximisation [16,17,28]. Diverse perspectives are offered in the social science literature regarding the nature of ‘well-being’, its drivers, and its indicators [17]. While there are differences of emphasis, there is widespread agreement that well-being is a multi-dimensional concept embracing the things that people value, including material conditions, individual freedoms, subjective states such as satisfaction, flourishing, thriving, and an associated set of capabilities and available opportunities [19,28,36]. A range of different disciplines, including psychology, sociology, anthropology, economics, politics, biology, and philosophy, provide the theoretical basis for well-being study. From an interdisciplinary perspective, [49] has proposed a now widely accepted list of ten core capabilities to serve as a universal reference for assessing human well-being: life, bodily health, bodily integrity, senses, imagination and thought, emotions, practical reason, affiliation, other species, play and control over one’s environment. The capabilities approach and its variants offer a framework to reflect the complexity of human well-being, giving a central role to freedom of choice and public deliberation in the selection of well-being indicators [46].

In recent years, several frameworks reflecting a capability perspective have been developed to further our understanding of both the nature of human well-being as well as strategies to achieve and maintain sustainable development. Prominent examples include the Better Life Initiative [50], Planet Happiness [51], Bhutan’s Gross National Happiness Index [52], and the Happiness Alliance literature [53]. Statistical agencies in a growing number of countries now incorporate well-being measures into their assessments of social and economic progress [54,55].

Essential criteria for constructing a well-being framework, and associated indicators, include recognition of both subjective and objective sources of well-being, and a distinction between current and future well-being outcomes [13,54].

In respect of the first criterion, both subjective and objective dimensions of resident well-being are essential components of any well-being framework to measure social progress [37,50,56]. Subjective well-being, embracing individuals’ emotional and cognitive evaluations of their lives, and life satisfaction, comprises three elements: life evaluation, experiential, and Eudaimonia [13,17]. Each of these elements is itself complex with several interactive components. Indicators of subjective well-being measure well-being outcomes directly, through individual reporting on these different aspects of their well-being [57]. In contrast, objective measures of well-being reflect externally verifiable, potential sources of well-being. Objective sources of well-being include material living standards (income, consumption, wealth, quality of housing, etc.), alongside the quality of life variables such as mental and physical health, nutrition, education, fairness in the distribution of goods and services, decent work, work-life balance, social relationships, community vitality, personal and financial security, environmental quality, and opportunities for civic engagement and quality of governance [13,37,50].

Tourism research in general has tended to emphasise subjective measures of well-being, employing relatively easily collected survey-based data on perceptions’, ‘attitudes’ and ‘satisfactions’ of both residents and tourists [58,59]. However, the focus on subjective variables provides only partial information concerning well-being, resulting in insufficient attention to its structural causes. Moreover, future well-being, dependent as it is on changing levels and qualities of capital stocks, cannot be addressed adequately in the absence of objective (physical or monetary) measures to complement subjective measures. Tourism researchers need to devote more effort to including objective dimensions of well-being in the policy assessment exercise and to analysing the links between the subjective and objective dimensions of well-being. A multidimensional approach with a mix of subjective and objective sources of well-being, comprising a broad dashboard of well-being indicators, provides a sounder basis for analysis and for the formulation, implementation, and appraisal of tourism policy than does the narrow focus on subjective measures [54].

A second crucial distinction that needs to be recognised in the development of a well-being framework is that between current well-being (intra-generational) and future well-being (inter-generational), thus embedding sustainability considerations into well-being analysis [60]. As argued above, changes in the different types of capital stock affect residents’ future well-being [24]. In tourism studies of resident well-being, the main focus has typically involved the well-being of the current generation with less attention to future well-being [4]. Neglecting the role of changing capital stocks as mechanisms for transmitting well-being outcomes for future generations, tourism studies of ‘sustainability’ have tended to focus largely on the current effects of development projects. As a consequence, the essential role of future well-being estimation, essential to determining whether a destination is progressing along a sustainable development path, has been neglected. Failure to distinguish the sources of current and future well-being has prevented sustainability considerations to be properly addressed in tourism studies [24].

A well-being framework can drive appropriate indicator selection in a strategic way, adapting over time according to changing destination circumstances including changes in resident values. In this respect, a large number of researchers have argued in favour of the Better Life Index as a comprehensive conceptual framework for understanding the sources of well-being and associated indicators [13,16,50,61]. A distinction crucial to the index is that between current resident well-being and future well-being, thus embedding sustainability considerations into well-being analysis. Acknowledging that there is no fixed set of indicators appropriate to tourism development in all destinations under all circumstances, the Better Life Index is flexible enough to include additional indicators of well-being as these are formulated for particular development contexts [60]. These features make this framework particularly suitable for the grounding of well-being measures to serve as key indicators of sustainable tourism development. All the above mentioned well-being frameworks may be expected to evolve as a result of ongoing conceptual and empirical advances, and the arguments herein do not depend on the adoption of any particular well-being framework.

5. Implications for Tourism Policy

Since each type of capital stock enhances the capacity to provide increased current and future resident well-being, destination managers can initiate policies to support sustainable development for the well-being of residents. Two issues are discussed in this section-transmission of well-being outcomes inter-generationally as a result of changes in the quantity and quality of capital stocks, and tourism policy as seen through a well-being lens.

5.1. Capital Stocks and Well-Being Transmission in Tourism Development

Capital stocks are enduring assets that improve well-being outcomes by expanding the capabilities of persons to lead valued lives. Well-being outcomes relevant to tourism capital stock changes include the following:

Economic (produced) capital. The larger the capital stock, the greater the future productive capacity, future potential consumption flow, and economic well-being. Economic capital in the tourism industry includes accommodation, restaurants, ancient ruins, historic towns, shopping complexes, theme parks, transport networks, cruise ships, airports, museums, recreational and sporting complexes, etc. Increases in economic capital attract tourist visitation and associated expenditure, leading to growth in GDP and employment, potentially increasing residents’ material well-being or ‘economic standard of living’. Capital formation, associated with tourism growth, increases the variety and quality of goods and services on offer within a destination, enhancing opportunities for improvement in resident well-being [62]. Productivity growth associated with increased investment is an important driver of tourism operator profitability, industry market growth, and societal material well-being [63]. Productivity growth has also been found to generate wider social outcomes beyond material well-being [63,64].

Human Capital includes the knowledge, skills, and attributes embodied in each person that enables them to fully participate in work, study, recreation, and society, supporting individual and social well-being. Two major drivers of human capital are the health and education systems. Good physical and mental health enables social and leisure activities that facilitate continuing engagement in the workforce, as well as enhancing resident well-being more generally [65]. By transmitting knowledge intra- and inter-generationally, education has a major impact on resident well-being and sustainable development. The education system, including tourism education, is linked to present and future well-being through the development of knowledge, skills, productivity, better health, lower crime rates, higher levels of trust and civic participation, volunteering, stronger family relationships, and deeper personal fulfilment [53,66].

Social Capital through its bonding, bridging, and linking functions, contributes to the well-being of persons [67]. Well-being outcomes include the development of cooperative norms, social cohesion, trust in civic institutions, ethical business dealings, job opportunities, reduction in inequalities, democratic participation in society, well-functioning social institutions, crime reduction, and enhanced sense of place and belonging [68]. Social capital in the tourism industry includes various networks, strategic alliances, joint ventures, associations, festivals, and events that foster a community spirit of sharing, supporting the hosting of visitors, and the expansion of new forms of tourism supply [65,69]. Tourism networking has been found to contribute to well-being outcomes by way of increased trust, cooperation, volunteering, community collaboration in destination management, pride in local culture, gender parity, ethical business behaviour, and civic engagement [69,70]. Tourism-related cultural activities associated with events and festival activities can play an important role in both creating and preserving different forms of social capital [71]. It may also be noted that ‘overtourism’ can result in alienation between residents and tourists and a lack of support for tourism development. This source of social capital erosion deserves more attention from tourism researchers.

Natural capital provides for basic human physiological needs, while also performing economic and social functions that contribute to personal and collective well-being [47]. Ecosystems that support well-being comprise four main types of services: provisioning services relating to food and materials; cultural services providing scientific, educational, recreational, aesthetic, and other services to people; regulating services such as the carbon cycle, climate control, air, and water filtration; and supporting services such as carbon storage, waste assimilation. Each type of service is essential to the biodiversity necessary for the health and survival of all life forms [32,72]. Various forms of tourism enable connections to nature, providing space for recreation and escape from urban stress, aesthetic enjoyment, and ‘higher’ experiences with positive well-being outcomes [73]. The quality of the natural environment where people live and work provides environmental amenities and opportunities for quality recreation. Within the Total Economic Value framework, used to value tourism developments, natural capital is taken to have direct and indirect user value as well as non-use value comprising option, existence, bequest, and altruistic values [74]. However, these values are typically derived using contingent valuation (willingness to pay) methods with the links to well-being outcomes yet to be explored in detail [75].

From a policy-making perspective, it is important to recognise the complex inter-relationships between the different types of capital and outcomes for resident well-being. The above discussion identifies only some of the associations between capital stocks and human well-being. Adopting the capitals approach to assessing sustainable tourism development supports public policy focused on enhancing the capacity of economic, human, social, and natural capital to improve the well-being of destination residents. Well-being indicators associated with tourism development should be based on those that demonstrate theoretical and empirical support and that are flexible enough to reflect local community values [37,50,56]. Many capital-related indicators remain absent from sustainability indicator lists [4,76]. While the role of changing capital stocks in affecting resident well-being is acknowledged by some tourism researchers [62,65,68,70], little effort has been made to analyse sustainable tourism development and policy making with changes in capitals and well-being as core concepts [24], has identified a selection of indicators of future well-being, consistent with the capitals approach, but further research is needed to develop more comprehensive lists. Adopting the capitals approach to assessing sustainable tourism development supports good public policy focused on enhancing the capacity of economic, human, social, and natural capital to improve the well-being of destination residents.

5.2. Tourism Policy through a Well-Being Lens

While standard approaches to policy formulation, implementation, and evaluation focus on the estimated impacts of developments, treating well-being seriously implies that policy makers must go beyond impact analysis to estimate the effects on human well-being. Well-being outcomes provide more detailed input into analysis and decision making regarding sustainable development than do standard key performance indicators that focus on economic, social, and environmental impacts only.

An important question is how to convert standard impact measures to well-being outcomes. A recent recommendation is for policy makers to employ a ‘well-being lens’ to convert changes in the quantity and quality of capital stocks to changes in resident well-being, intra- and inter-generationally [60,77]. A multidimensional well-being lens comprising indicators relating to current and future well-being, including those relating to risk, resilience, and changes in capital stocks and flows, can monitor societal progress and identify policy priorities [60,78]. Ideally, the lens will comprise a mix of subjective and objective dimensions of well-being and include both ‘generic’ indicators based on credible well-being frameworks and ‘contextual’ indicators formulated for different tourism destinations and development contexts [13,78,79]. Depending on the well-being framework employed, indicators are likely to include economic and physical security, work-life balance, job satisfaction, social connections, health and education, job quality, levels of trust in institutions, the extent of civic engagement, environmental quality, and so on, that tend to be ignored in standard impact assessment. The particular dashboard indicator set comprising the well-being lens can be used to convert economic, social, and environmental impacts to well-being outcomes, and to guide policies that improve resident well-being. A well-being lens can help draw policy attention to societal well-being outcomes that may otherwise be neglected. It can also help to forge stronger links across public agencies and between public, private, and civil society actors in strategizing to enhance resident well-being [60]. It can also be applied to different stages of the policy cycle, from strategic analysis and prioritisation to policy evaluation [55].

Used by tourism stakeholders, the well-being lens forces consideration of the effects that alternative development policies might have on aspects of residents’ lives, thus allowing tourism development to better align with the broader Beyond GDP research agenda emphasising societal progress as the primary policy objective [39,60].The well-being lens can inform decision makers about resident well-being outcomes of alternative tourism development strategies, thus helping to identify preferred development paths. Well-being outcomes with particular relevance to tourism can be included to inform the content of the well-being lens formulated for different tourism destinations and contexts. Estimated resident well-being outcomes can be used to guide the effective allocation of resources in tourism-related developments. Destination managers can formulate tourism development strategies that account for current and future potential impacts across multiple well-being objectives. The well-being lens also enables the trade-offs implicit in any set of policy choices to be more open and transparent. Resident groups and communities advantaged and disadvantaged by development strategies can be identified and mitigating actions are undertaken where appropriate. The problems involved in linking well-being outcomes to the available policy levers must not be minimised [60].

The well-being lens reflects a community-based approach to achieving sustainable tourism development. At a grassroots level, residents can engage in a visioning process with workshops, consultations, and public surveys employed to determine community values, thus embedding meaningful citizen participation in the policy process [46,77]. The outcomes of these workshops (citizens’ assemblies and councils) can help to inform policy makers of the particular well-being indicators to include in the lens to determine the overall effects of tourism developments on social well-being [77]. Community visioning initiatives also allow residents to play a more direct role in public agenda setting and decision making regarding the direction of tourism development while gaining a deeper understanding of the interplay between different potential well-being outcomes [77]. Establishing the well-being lens through an inclusive and transparent, participatory process is crucial to identifying resident well-being priorities, and ensuring public support for policy assessment criteria [55]. The composition of the lens may be expected to change over time as better well-being measures are developed and as destination policymakers agree on indicators that can better capture conditions affecting resident current and future well-being outcomes for different demographic and geographic segments of the resident population [24,27].

In several recent papers, [63,80,81,82] Dwyer has shown how the well-being lens, comprising a broad multidimensional indicator set, can act as a ‘filter’ or ‘prism’ to identify potential current and future well-being stakeholder outcomes associated with some important areas of tourism research and practice, including tourism participation in the 2030 SDG agenda [81]. In much of the research literature, positive well-being outcomes are (incorrectly) assumed to accompany progress in achieving each SDG. Assessment of tourism’s progress toward achievement of the SDGs is incomplete, however, without a full accounting of the well-being outcomes of tourism development [81]. Taking greater account of resident inter-generational as well as intra- generational well-being helps to embed the longer-term focus essential to achieving and maintaining sustainable development across all industries. The well-being lens through which tourism development impacts must pass can play an important role in identifying policies that enhance social well-being and in estimating resident well-being outcomes of alternative development paths.

6. Some Challenges Facing Sustainable Tourism Development

Several theoretical and practical challenges must be addressed if the capitals approach is to support sustainable tourism development. Important challenges include the valuation of capital stocks, adopting a broader notion of critical capital, overcoming the behavioural and institutional barriers to embedding well-being measures into policy making, and enhancing destination capacity to deliver well-being outcomes from tourism development.

6.1. Valuing Capital Stocks

The capitals approach must confront challenges regarding valuation of the different types of capital [83]. Valuation techniques developed in the wider social sciences can be used to value capital stocks and flows associated with tourism industry. The standard approach is that the value of a capital stock should equal the discounted stream of the expected net returns over its lifetime [84]. Measurement of economic (produced and financial) capital and types of natural capital that have market prices is fairly straightforward, but the extended application of the capitals approach to include human and social capital and some types of natural capital, such as life-support services, will require ‘shadow pricing’ techniques to correct for situations where market prices are absent or distorted [26]. Acknowledging the difficulties of estimating shadow prices, to monitor changes in capital stocks, monetary measures be complemented by a limited set of physical indicators [61]. The dominant approach to measurement is now the ‘hybrid capital approach’ employing both physical and monetary measures of stocks and flows [16,22]. This pragmatic approach facilitates the application of the capitals approach to tourism development, while researchers and policy makers seek to improve ways to value all capital stocks and flows. At the same time, participatory techniques to determine community values, such as deliberative monetary valuation, may be expected to continue to gain the favour of researchers and destination managers [62.75]. Participatory techniques have particular relevance where deep ethical/cultural convictions stand in the way of monetisation [85], an important issue in various tourism development contexts.

6.2. A Broader Notion of ‘Critical Capital’

Natural areas may have critical value largely associated with their symbolic value to local communities, rather than any outstanding ecological, scientific, or aesthetic value [86]. Some natural resources may be regarded as ‘critical’ due to their location and symbolic significance in defining group identity and strengthening community sense of place, their value for amenity, recreation, and education, and for connecting people with nature [40,87]. Areas of outstanding natural beauty, for example, have an economic dimension (revenues from tourism visitation and employment creation), an ecological dimension (biodiversity, habitat protection), and a socio-cultural dimension (heritage value, sense of belonging). Determining the associated well-being outcomes demands a better understanding of the different functions of natural capital and their interaction with human societies, as well as an improved understanding of human basic needs and values [47].

Aspects of each type of capital may be regarded as ‘critical’ for the sustainable development of the tourism industry according to particular features of the destination and its inhabitants. Societal values and perceptions and attitudes to risk are crucial for determining which specific aspects of capital stocks are considered to be ‘critical’. Beyond natural capital, there is a strong case for regarding certain irreplaceable social, cultural, and historic artifacts and rituals pertaining to indigenous heritage and knowledge and unique, historically valued, architecture such as ancient monuments, castles, and villages, as ‘critically important’ to the current and future well-being of residents. Ultimately, permissible trade-offs between the different types of capital stocks cannot be determined without reference to the outcomes for current and future well-being [88]. While the proponents of SS have tended to focus on levels and flows of critical natural capital, any aspect of any capital stock may be regarded as critical to human well-being if it contributes to well-being in a unique way that cannot be replicated by another aspect or type of capital stock. In practice, a process of ‘well-being diagnostics’ could include minimum thresholds, or ‘guardrails’ for tourism-related capital stocks essential to residents’ current and future well-being [89].

There is strong support for the view that the ‘criticality’ of each type of capital stock depends on ecological, economic, political, social, and cultural criteria [86]. Consistent with SS, minimum amounts of different types of capital stocks (economic, human, social, natural) should be independently maintained if valued sufficiently by society [90]. This flags the need to widen the definition of ‘critical capital’ to embrace those capital assets that are irreplaceable, subject to uncertainties, are valued for symbolic, spiritual, cultural, and similar reasons, and which make a unique contribution to present and future well-being [47]. This perspective, largely ignored in the recent sustainability debate, has substantial implications for tourism industry development. In any specific tourism development context, stakeholders can determine which critical thresholds, or trends, can be identified and the extent of stakeholder acceptance or resistance to any potential breach of critical thresholds. For any proposed development project, certain trade-offs may be ‘acceptable’ at a local level, but not at the destination level, or vice versa. Accounting for critical thresholds in policy making would enable tourism decision makers to identify circumstances where trade-offs between capital stocks are unacceptable [45]. The issues raised here demand further research to develop indicators of critical levels of different capital stocks, where the notion of ‘criticalness’ and associated stock threshold levels may differ between different tourism communities in different tourism planning contexts.

6.3. Overcoming Barriers

Before well-being considerations can enter into policy assessment globally, several major barriers must be overcome. These include institutional resistance to change, lack of political imperative, and lack of government support for the development of well-being measures [60,77]. Current global economic, political, and social systems are not well suited to meet the challenges of achieving or assessing sustainable development in tourism or any other industry. A substantial barrier to the development of better measures of destination progress is the neoliberal view that GDP growth is the primary goal of development. This results in a short-term focus on profitability rather than long-term social benefits [15,84].

Additionally, both private and public sector organisations, as well as statistical agencies, have a vested interest in maintaining the status quo or ‘business as usual’ in collecting, reporting, and managing standard economic indicator sets [7]. Globally, government ministries and departments operate in silos, focused on their own objectives, minimising incentives for involvement or accountability in the outcomes of other agencies. Attempts to develop and employ well-being measures may also be sidelined in order to meet other statistical priorities of government agencies, particularly in developing economies focused on economic performance [60]. The development of tourism-related statistics presents even greater challenges given that much of tourism activity globally occurs in the informal economy, outside the scope of institutionalised data collection channels. Reducing these barriers will take time and the strategies to be undertaken by stakeholders in different industries may be debated [60].

6.4. Designing for Well-Being

In parallel with attempts to eliminate such barriers, policy makers should strive to expand capacity, putting structures in place to generate and assess well-being outcomes from tourism development [78]. Designing for well-being will be a long-term process that ultimately requires embedding well-being outcomes into the culture and machinery of government policy making. The objectives include the following: policy design that systematically considers potential impacts across multiple well-being objectives, including sustainability; shifting away from narrower performance indicators employed by individual departments, towards shared outcome-based well-being objectives across all levels of the public sector; and strengthening the connections between government, the private sector, and civil society through recognition of well-being as a shared objective [29,78]. Such initiatives, if successful, can allow public and private sector organisations to invest in types of built, natural, human, and social capital that will best enhance well-being outcomes given the resources invested. The use of a lens, with social well-being as a common objective, can enhance dialogue and cooperation across different decision makers while helping to achieve stronger strategic alignment across public agencies and between public, private, and civil society organisations [60].

Several national governments have taken steps to enhance the capacity of destinations to pursue resident well-being as the primary policy objective [60]. Specific initiatives include the following: embedding additional indicators of social progress into systems of national accounts, improving the well-being evidence base available to policy makers, legislative measures to ensure well-being outcomes are addressed in policy formulation and assessment, creating new institutions or agencies with responsibility for monitoring resident well-being, training for decision makers to analyse and interpret the well-being outcomes of alternative policy measures, and engaging with residents on their needs and values [64,77,78]. Notwithstanding these efforts, a great deal of effort remains to be undertaken globally to promote the effective use of well-being metrics in policy public and private sector policy making.

There is insufficient space herein to explore possible strategies to enhance national capacity for well-being analysis and the implications for the tourism industry’s sustainable development. However, in the view of an increasing number of critics, particular initiatives will be successful only if accompanied by a transformative shift in values divorced from neoliberalist thinking. Many now identify a ‘paradigm change’ in stakeholder values and practice as necessary at all levels of decision making in order to install well-being in its appropriate place in enabling sustainable development [7,10,12]. The conditions for bringing about this paradigm shift in tourism are still the subject of debate [9].

7. Conclusions

This paper has argued that tourism development theory and practice must become more relevant to, and more consistent with, advances in sustainability theory and practice across the social sciences. To address this issue, tourism researchers need to better appreciate the essential dynamic dimensions of sustainable development that are unable to be captured within static models. Taking greater account of inter-generational as well as intra- generational well-being helps to embed the longer-term focus essential to achieving and maintaining sustainable development of the tourism industry. The core insight from the capitals approach to sustainability is that the quality and quantity of economic, human, social, and natural capital stocks determine the range of opportunities resulting from tourism development, and thus well-being outcomes experienced by both present and future generations of residents. Despite a substantial body of study of sustainability issues in tourism research, the role of changing quantity and quality of capital stocks as transmission mechanisms, linking current with future resident well-being, has been relatively neglected. Since tourism policy making must account for resident well-being if it is to make a real difference to people’s lives, managing a portfolio of different capital stocks to enhance resident well-being must now be regarded as a core task of tourism destination managers. To help destination managers perform this task efficiently and effectively, tourism researchers need to provide informed input on the various links between capital stock changes and the associated resident well-being outcomes.

The capitals approach provides the basis for distinguishing between weak and strong sustainability, another issue typically ignored in tourism research. A major problem with the WS concept is that neoclassical growth theory treats ‘welfare effects’, based on the narrow notion of ‘consumer utility maximisation’, as equivalent to ‘well-being outcomes’ failing to capture the much richer multi-dimensional conception of ‘well-being’ advocated in the social sciences. More comprehensive well-being measures, including objective measures, are needed to assess the extent to which tourism development is proceeding sustainably. Tourism researchers can play an important role in future studies by identifying relevant well-being measures for different tourism development contexts. A second major problem for WS involves the assumption that capital stocks are substitutable for one another—any one type of capital can be degraded or depleted provided ‘returns’ are reinvested in other forms of capital. In contrast, SS asserts that some types of capital (particularly natural capital) are, to a varying extent, non-substitutable in the production process. In this view, a minimum stock of natural capital is critical for maintaining human life-support systems and other environmental services with unique well-being outcomes for which no amount of technological change currently or in the future can compensate. This issue also requires further research in various tourism development contexts, local and national.

The implications of WS and SS perspectives have received minimal attention in the tourism planning and development literature. While the majority of tourism researchers addressing sustainability issues appear implicitly to adopt an SS view, little attention has been paid to the theoretical and practical implications of applying SS conditions regarding critical capital stocks in tourism planning and development and the consequences for resident well-being. This highlights another important area for tourism research.

Given the problems associated with extreme versions of WS and SS, it was argued that tourism development policies should adopt a balanced approach, where substitutability between various types of capitals is allowed to some extent (consistent with WS) while maintaining threshold levels of stocks deemed to be ‘critical’ (consistent with SS). A practical way to consider the needs of future generations of residents requires destination managers to monitor changing levels of stocks, their substitutability for one another, and the well-being outcomes while maintaining at least threshold levels of particular types of stocks where future compensation for their loss is not feasible. Tourism researchers need to address this issue to provide informed input to destination managers at both a conceptual and practical level.

Extending the general SS literature that focuses on the criticality of certain stocks of natural capital, the paper has argued that certain stocks of each of the other types of capital such as social networks, indigenous culture, and language, modes of living, historic architecture, may be regarded as ‘critical’ for sustainable development of the tourism industry. On this view, depending on society’s values, minimum amounts of a number of different types of capital may be maintained in the destination. A substantial research effort is needed to articulate the meaning of ‘critical’ economic, human and social capital stocks and methods to determine threshold levels in different tourism development situations. At the bottom, permissible trade-offs between the different types of capital stocks cannot be determined without reference to the outcomes for residents’ current and future well-being. This implies that the minimum threshold of any type of capital to be maintained in any given development context will be a matter of social choice. Tourism researchers can play an important role in investigating resident values concerning different levels of each type of capital stock and the resultant well-being outcomes. This research could involve pilot studies of the local area and wider-scale developments.

The arguments herein demonstrate that tourism researchers must pay greater attention to the role of resident well-being outcomes as an essential dimension of sustainability, and its connection with changes in the quantity and quality of capital stocks over time. The use of a well-being lens enables the conversion of tourism development impacts into resident well-being outcomes. Public and private sector organisations can invest in types of capital stocks that will best enhance well-being outcomes given the resources invested in any policy or project. As discussed, several challenges, theoretical and practical, must be addressed if the capitals approach is to support sustainable tourism development. Overcoming these challenges and developing strategies to enhance opportunities to deliver well-being outcomes associated with tourism development, may be expected to drive tourism-related research on sustainability in the coming years.