Evaluating The Economic Impact Of Universal Studio in Aruba Case Study

Potential Benefits and Challenges of a Universal Studio in Aruba

Chapter 1: Introduction

1.1 Background of the project

Universal Studios gets referred to an internationally popular chain of theme parks and resorts renowns for the re-enactment of the TV shows and flicks produced by Universal Pictures and its associates. In these theme parks, exciting things that are happening in the screen are brought in the real lives with rides shows, attractions, and themed areas keep guests in living the world of their favourite screen characters. Opening a Universal Studio in Aruba is an ambitious project that holds the ability to change and develop cultural as well as economic environment of the island. This project builds on Universal Studios' renowned rich legacy and its popularity across the world as a brand that represents cutting edge entertainment and interactive theme park destinations under Carl Laemmle in 1914 (Byunique, 2021). The choice of Aruba, a Caribbean island known for its idyllic setting, constant sunny climate and vibrant cultural mix is appropriate because it provides the backdrop to an entertainment destination that enhances rather than detracts from the natural beauty of this attractive tourist location.

Central to this undertaking is the prospects of significant economic development driven mainly by employment in different sectors such as direct jobs within the park and ancillary opportunities for services industries, cumulatively tourism (ILO, 2016). In addition, this project is expected to support Aruba's tourism industry attracting new classes of travelers interested in the Universal brand consequentially diversifying and enriching island possibilities. Nevertheless, the project has challenges especially on infrastructure related developments and need to address environmental sustainability concerns as well maintaining culture of local people. Insights gained from Universal Studios' growth in other parts of the world will play a critical role in overcoming these obstacles.

1.2 Problem Statement

The influence of Universal Studios on local tourism can be defined by examining USS case. Opening of USS greatly affected the tourism culture in Singapore, and as such it can contribute to observations for what would be proposed project on Aruba.

The opening of Universal Studios Singapore in March 2010 made it one of the major attractions (Long, 2021). By January 2017, it had its 25-million visitor whereby it was very popular. Such an achievement highlights the capability of a Universal Studio park to attract thousands of visitors, which will be one of the major advantages for Aruba (Kelleher, 2023). In addition, the success of the USS ensured a change in Singapore's image from being primarily known as a business destination to being considered more tourist-centred. Universal Studios made a major contribution to Singapore's tourism by providing an entertainment element (Rwsentos, 2019). This implies that the same development brought about in Aruba could further increase its attraction as a destination for tourists besides natural beaches and outdoor activities.

Singapore's geographic strategic positioning and its multiracial setting also contributed to USS success (CDR, 2022). The fact that the park was able to celebrate different cultures through its events and attractions made it an ideal ground for international tourists from diverse backgrounds. One of the main factors that can help to make Universal Studios in Aruba a success is through exploitation of its distinctive cultural and geographic attributes. Further, the case of Universal Studios Singapore points to the need for assessing local market and tourist characteristics if such a theme park's success is desired. It implies that meticulous planning, the definition of target market and considering local cultural norms along with environmental factors are vital to start such a venture.

After the recession that occurred between 2015 and 2016, the Aruba government has been introducing fiscal consolidation strategies. Public debt of the country was above 90% GDP in 2018 being a result from deficits accrued after financial crisis. In response, Aruba and the Dutch government through CAFT fiscal objectives are based on overall balance (IMF, 2022). These goals include limiting a budget gap of 1.5-2 percent of GDP in the medium term, depending on estimated growth rates. This data on the economic situation provides a specific assessment of how it will be developed from 2023 to 207 for all countries globally and especially regarding those considered as advanced economies such as US. The projection shows a divergent trend for the US GDP, which will decelerate in 2024 before slightly pick up again four years later (IMF, 2022). This tendency might demonstrate sui generis internal economic corrections or the global factors that influence US economy (CDR, 2022). Developed nations are also likely to follow this trend, thus pointing out at a wider economic phenomenon which affects these countries. World GDP and trade, on the other hand, show a positive trend because world economies are expected to grow steadily while global commerce is forecasted to pick up significantly. This might suggest a strong comeback to stimulate an international market relationship rebuilding and economic activities, which may recover from the previous global disturbance.

The strong control and management of the inflation factors have been realized through relative stability recorded on CPI US as well as for developed economies, a factor which leads to economic instability (Coibion et al., 2020). The manufacturing sector and non-oil commodities prices display tendencies of increasing or decreasing possibly due to shifts in the global supply side relative demand. Oil prices, interestingly are set to drop marginally which could arise from several factors such as changes in energy consumption levels; increased production or diversification towards other renewable forms of energy.

The Aruban government made several reforms towards these objectives by mid-2018, including a tax reform (Deloitte, 2018). The BAZV, which is the general health care contribution was increased by 1 percentage point. Secondly, a new 1.5 percent tax on business turnover was added to finance public-private partnerships (BAVP). As a result, the aggregate tax on business turnover that includes BBO BAZV and BAVP is 6 percent. There are differentiated tax structures for the hospitality industry, and hotel accommodation attracts substitute turnover tax at 9.5% with a lower rate of 4.750 applicable if the price paid include board-based on Abbing (23)

1.3 Aim

The main goal is that this entertainment park will have a positive impact on the country of Aruba, which will create a lot of jobs, and economic growth development, cultural enrichment and overall societal well-being.

1.4 Business project questions

• How many jobs could be created and how many employment possibilities may there be if a Universal Studio opens in Aruba?
• What potential impact may a Universal Studio have on Aruba's tourism and hospitality industries?
• What are the expected financial benefits of opening a Universal Studio in Aruba?

1.5 Business Project Objectives

Objectives

The objectives of this given research proposal are as follows.

• To look at the possibility of job development and employment opportunities if a Universal Studio is built in Aruba.
• To assess the effect of a Universal Studio on Aruba's tourism and hospitality sector.
• To focus on entertainment park which we will call Universal Studio, will be given the opportunity for open vacancies for many positions which will be very positive for country Aruba.

1.6 Scope of the Business Project

Universal Studio in Aruba project is a multidimensional initiative that incorporates various facets ranging from economic development to commitment on cultural identity. Its main objective is to contribute to the local economy by job creation directly inside and outside the park's sectors such as tourism, retailing and construction (Deloitte, 2018). A integral part of this project is its capability to improve Aruba's tourism product, attracting a more diverse range of international tourists and lengthening the season for tourist activities. On the financial side, it creates various income streams such as park entries, souvenirs and in-site services that include hospitality.

However, infrastructure development is also an important piece of the puzzle consisting of construction work and sustainable design to support the functioning park while acknowledging Aruba's environmental philosophy (Mavi et al., 2021). The project also walks a cautious line in the cultural sphere, seeking to integrate Aruba's colourful history into thematic aspects and involving local community involvement. It is crucial to navigate the legal terrain specifically in relation to Aruba's tax system and regulatory framework for compliance of this project. Additionally, strategic marketing and branding is key in aligning the Universal Studio brand with local customs while upholding its international exposure.

1.7 Limitations of the Business Project

The initiative of creating a Universal Studio in Aruba constitutes some factors that cannot be overlooked and may affect the outcomes badly (Kelleher, 2023). To start with, the project is confronted with a number of financial and economic challenges regarding its viability considering high investment costs in relation to Aruba's huge public debt. Additional uncertainty is introduced by the reliance on highs and lows of tourism industry. Environmental issues are important because of the immense infrastructural development needed for this huge project with Aruba's vulnerable environmental ecosystem. The balancing of development and environmental sustainability is not only essential but also difficult.

Culturally, the introduction of a global brand in entertainment makes Aruba to lose its local culture and authenticity. It is critical, although it may be challenging to incorporate and maintain the cultural heritage of that island in the theme. Another major challenge is traveling through Aruba's regulatory and legislative waters, especially after the recent tax reforms and fiscal policies. This entails compliance with local legislation on labour, construction as well as environmental protection.

1.8 Structure of the Dissertation

• Chapter 1: Introduction: These are desired outcomes of implementing a Universal Studio theme park in Aruba, as a means of impact assessment, it comes with the theme park activities, objectives and rationale for support because of the potential to further boost economic growth, tourism, making it a more appealing destination and employment.

• Chapter 2: Literature Review: Analyzes current studies conducted on the theme parks economic, tourism, environmental, as well as socio- cultural aspects that exist globally identifying gaps and need of research relevant to Aruba.

• Chapter 3: It articulates the approach concerned with the design of research, phases that entailed the collection of data as well as analytical techniques which were used as a measure to determine the likelihood of Universal Studio theme park influencing Aruba.
• Chapter 4: Results and Discussion - Provides the results of the study, revealing projected economic, tourism, and employment gains, and acknowledges the associated environmental and socio-cultural consequences. This discussion concludes by comparison of the results within the Aruba case.
• Chapter 5: Conclusion: Summarizes the study's main findings, discusses the effects that theme park development in Aruba may have on the stakeholders, suggests recommendations for future studies and planning and ends with the possible long-term effects that the project may have on Aruba.

Chapter 2: Literature Review

2.1 Introduction

The potentiality of the Universal Studio theme park to function in Aruba promises high feasibility for meaningful transformations that have been missing in the economic structure, tourism market, and job market of the island. In this chapter, it presents a basic premise that underpins our research proposition to subject the multi-dimensional benefits of establishing a super major entertainment park in a small island economy to explorative analysis. It is therefore not just a possible tourist attraction that is to be imagined but one critical factor for the broad-based economic development, employment creation and revitalization of the hospitality industry so to speak.

2.2 Economic Impact and Job Creation

The news regarding the opening of a Universal Studio theme park in Aruba forecast massive economic change and employment generation following the trend set previously as the catalysts for revolutionary development within the island's economy. This is set to snowball into a domino effect, creating a wide range of employment opportunities including direct ones within the theme park and associated areas such as construction, hospitality, retail, and transportation. It is predicted that by only building the directions, hundreds of jobs will be created and will trigger local firms and contractors in constructing the necessary infrastructure for such a huge entertain enterprise. Beyond that, the park's operating period will need frontline staff, administration, plant operation, client care, upkeep, and shows staff, for instance.

Additionally, the introduction of the Universal Studio is expected to increase skill improvement in the local public. The creation of specialized positions, especially those of fiesta park commandant, entertainment services and technical services will involve significant human resources transfer and opportunities for career advancement for the Arubans (Lerch, 2022). This not only helps in bringing down the unemployment rate but also raises the general level of productivity of the workforce, thus enhancing its competitiveness and versatility, and the effect of this change is cumulative.

Apart from direct employment opportunities, the theme park is also expected to engender indirect jobs creation owing to an upturn in the demand for local raw materials and products (Joseph, 2023). Supply chains and other businesses in it will reap the benefits of increased demand for more employment creation while at the same time creating more avenues for businesses. The indirect economic effect of theme parks goes beyond the hospitality sector; attraction of more visitors to the island translates to full occupancy rates in hotels, increased patronage in restaurants, and increased patronage in local businesses, thus providing boosts to the wider hospitality and tourism sectors.

Aruba's GDP will be greatly augmented by the inflow of capital and operational expenditure from the theme park. The simulated increase in tourist arrivals and spending the theme park will add significantly to government revenues through taxes and propel further investment in local infrastructure and services generating an environmentally sensitive cycle of further economic growth and development (Yang et al., 2021).

Essentially, the decision of Universal Studio to build a theme park in Aruba is more than just an entertainment vision- it is an economic development plan also. It has the potential to make Aruba's economic base, consequently, provide a range of employment, train the abilities of the local employees, and promote economic growth considerably. Thus, the project aims itself to be a lighthouse for economic revitalization emerging the island and its people into a world of sustainability and dynamism (Yang et al., 2021).

For example, the development of Universal Studios in Beijing was informed to generate more than 40, Assuming that such a scale is applied to Aruba, with some adjustment to its size and capacity, this could produce several thousand construction jobs over several years. Operational theme parks such as Universal Studios take large number of staff. For instance, Universal Orlando Resort located in Florida has more than 25,000 employees. A Universal Studio park would create between 3,000 to 5,000 jobs in Aruba where it would assume immediate jobs such as operations, entertainment, maintenance, food services, and retail among others.

Themes parks stimulate the employment effect to indirect sectors such as hospitality, retail, and transportation sectors from the economic multiplier effect. Theme park's economic impact studies show that for every direct job that is created, an additional 1 to 2 indirect jobs are generated in the local economy as a result of increased demand for services and goods. In the case of Aruba, it would be 6,000-10,000 more jobs available, taking local economic factors into account. In 2019, the GDP of Aruba was estimated to be around $ 2.7 billion (Cbaruba.org., 2019). The introduction of a Universal Studio park, taking into account direct and indirect economic repercussions; could potentially hike the GDP by a considerable amount. For instance, theme parks in developed countries have added between 0.5% to 2% points to the local GDP subject to the level of investment and the size of the prevailing economy (Cbaruba.org., 2019).

2.3 Impact on Tourism and Hospitality

It is foreseen that the opening of a Universal Studio theme park in Aruba will significantly change the island's tourism and gastronomy sector (Rudge, 2021). This effect could also be disintegrated into several important aspects that are contributing for complete transformation of tourism landscape and as its increasing revenue of the hospitality industry.

Increased Tourist Arrivals

The presence of Universal Studio theme park in Aruba was likely popular and the pull of the Universal Studio in Aruba with the magnificent Universal Studio brand with all the attractions it would attract millions from around the world to Aruba and this would translate to increased tourist arrivals in Aruba (Marr, 2023). Making use of the attraction of novel and singular experiences to visit the place, the park would attract not only Universal Studios' franchises' fans but general tourists in search of a more enriched holiday. For example, following the unveiling of the Wizarding World of Harry Potter, Universal Orlando Resort disclosed in attendance of 30% which is attributable to the Potter's magic. Provided Aruba manages to grow by even small margins of that level of increase it would significantly lift its position as a destination for tourists (Marr, 2023).

Extended Length of Stay

With rides, shows, restaurants, and shops, Universal Studio parks have something for everyone when tourists visit the park they will tend to spend longer time there than what they had originally planned for. This leaves sees that the long stay directly takes into increased revenue in hotels, resorts, and vacation rentals. As demand for such amenities masters the city, presence of big theme parks generally boost average daily rates (ADRs) that go ahead to benefit the regional hospitality business monetarily (Marr, 2023).

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Seasonality Mitigation

Seasonality is one of the problems facing many tourist destinations; peaks and troughs in visitor flow creating instability locally in economic ramifications (Orhan Yabanci, 2023). A Universal Studio theme park, due to its constant attraction, can keep the stability of tourist flows, minimizing the seasonality effect. This contributes towards stable permanent income that eventuates to economic planning and job security to the hotels, restaurants and a whole range of other tourist services (Orhan Yabanci, 2023).

Enhancements to Infrastructure and Services

Imminent rise of tourist arrivals requires upgrades to road networks, water, power, and digital network infrastructure (Khan et al., 2021). These changes not only facilitate the requirements of the theme park but also develop the tourism and hospitality industry through the quality of visitors' experiences in Aruba Investments in infrastructure are also associated with higher satisfaction rates of tourists; traveling again and speaking well to other people, these tendencies have a positive impact on tourism.

Diversification of Tourist Demographics

Universal Studios has a broad appeal to different groups of individuals; ranging from parents and their kids, young adults, and film freaks (Cross, 2021). Such diversification is therefore providing the hospitality industry a great platform to accommodate a diverse audience such as designing packages and offering services that suit different age groups and interests. It also creates new marketing avenues and is opportunity of partnership for the local vendors (Cross, 2021).

Financial Impact

The financial effects on the tourism and hospitality sectors can be great as stated above. During peak seasons hotels and accommodations achieved better occupancy rates and peak season pricing, thereby directly benefitting themselves (Zhang, Xie and Sikveland, 2020). While this is happening, tourists find their way to restaurants, bars and retail because they want to spend their spare time away from the park. Cumulatively, these elements translate to a considerable increase in the sector's overall revenue. Most striking, the introduction if a Universal Studio theme park to Aruba would not only increase tourist arrivals but also transform their tourist experience quality and variety. This advancement has the capacity to be used as a platform for the local economy, taking advantage of both tourism and hospitality teams to impel the country's economy. But to maximize these advantages some measures which include development planning, infrastructure investment, marketing strategy as well as service diversification are required. The approach will thus witness a long-term success of the Aruba tourism industry due to the introduction of the theme park (Sáez-Fernández, Jiménez-Hernández and Ostos-Rey, 2020).

2.4 Financial Benefits

Establishing a Universal Studio theme park in Aruba has a wide range of financial benefits starting from direct benefits in terms revenue generation to significant indirect impacts on the local economy. The data presented is precise different numbers will depend on the scale of investment, size of the park, and some individual parameters; however, insights can be made from similar developments worldwide to estimate potential financial results.

Direct Revenue Generation

Ticket sales constitute one of the main sources of revenue generation through which theme parks make money, while other aspects include annual passes, in-park purchases (food, drinks, clothing, etc.), and special events. For instance, Universal Studios Japan produced revenues of around $2.3 billion in 2018 (Cbaruba.org., 2019). Although Aruba's park would be considerably smaller, a conservative approximation might suggest annual revenue in the hundreds of millions of dollars, based on the park's size and patronage.

Other sources of additional revenues may be licensing agreements, sponsoring and partnerships with major international brands which only serve to increase the financial viability of the park.

Economic Impact on Local Economy

The overall impact on the GDP of Aruba would also be quite large. Therefore, speaking of the direct functioning of the park and the spillover effects, the theme park might contribute 1-2 % to the national GDP due to the estimation of the final investment amount and successful operations (Cbaruba.org., 2019). The government also stands to benefit with money via increased taxes down through increased spending and business turnover that results in sales taxes, income taxes, and corporate taxes. Taking into account the aspect of increased tourism and spending, tax revenue can reach tens of millions of dollars each year.

Indirect Economic Benefits

Indirectly through the park's development, employment opportunities will be generated in different segments ly construction, supply chain, tourism, and hospitality sectors (Nhamo, Dube and Chikodzi, 2020). Employing a multiplier effect, every direct job generated by the theme park would create an additional 1-2 jobs in the economy, greatly reducing unemployment rates and ensuring the improvement of the overall economic state. Investments in infrastructure that cater for the theme park such as roads, utilities and public transport can create lasting benefits for the local community and economy, increase the standard of living, and attract more investments (Nhamo, Dube and Chikodzi, 2020).

As the number of tourists increases, the volume of demand will also grow for restaurants, hotels, and shops which will raise revenues. For example, a rise of 10-15% in arrivals would mean an increase in annual spending by $20 – $30 million, assuming typical expenditure habits for a visit to Aruba. It is a fact that the announcement and inception of a big theme park can boost the value of property and also promote property development in the nearby vicinity which can be highly beneficial to the local property owners and can further add to the urban growth of the region.

2.5 Sustainability and Environmental Considerations

Penning a Universal Studio theme park in Aruba brings to the fore the aspect of sustainability and environmental factors. Considering the fragility of this island's ecosystem on the backdrop of the intention of the global community to practise sustainable development; the incorporation of environment management in the project's design, construction are operation is critical (Skene, 2020). Although there is no exact information on the environmental parameters of such a program in Aruba it is still possible to formulate certain lessons, which can be deduced from similar projects and sustainability tendencies in the theme park industry.

Environmental Impact Assessments (EIA)

Before any form of construction, an EIA to be carried out in a detailed way is necessary. EIAs assess potential environmental threats and recommend stirrups that are money the ecological mayhem (Nita, Fineran and Rozylowicz, 2022). For instance, the inner components of the EIA for Disneyland Paris included some peculiar points of water, waste and, on the one hand, habitat, and on the other implementation of resource-saving practices including wastewater recycling and a green belt around the park. Environmental impact assessment for Aruba would need to envision measures to preserve coral reefs, local wildlife, and water resources, that is the park development will not harm the natural beauty of the island and diversity.

Sustainable Construction Practices

Application of sustainable construction methods can actually help to greatly cut down on the ecological footprint of the phase of building the theme park as well (Solaimani and Sedighi, 2019). This also refers to the adoption of renewable energies, the use of sustainable materials as well as technologies which help to minimize the use of energy and water. For instance, Shanghai Disney Resort was given LEED (Leadership in Energy and Environmental Design) Platinum certification as it came up with an innovative concept of environmental design mainly featuring the largest green roof on any Disney property (Solaimani and Sedighi, 2019). This could be considered a reference for future developments creating an example of a similar sustainable construction method in Aruba.

Operational Sustainability

Once uplifted, the theme park should not forget to focus on sustainability through applicative energy efficiency, water conservation, waste reduction or reduction of biodiversity (Sheth and Parvatiyar, 2020). For example, Universal Studios Hollywood has introduced food waste composting, water-efficient landscaping, and the use of solar energy, greatly decreasing its ecological footprint. It is sustainable that in Aruba, Universal Studio Park employing renewable sources of energy for example solar and others would be very effective due to climatic factors and also Aruba location. Furthermore, the reuse of treated wastewater, collection of rain water and recycling for landscaping it is very important in Aruba where it is dry.

Economic Sustainability

Economic viability contributes significantly to the theme park's sustainability profile (Smith et al., 2021). This means developing a business model which while contributing to profitability also looks after the local outlook economic channels by not consuming natural resources. Practising fair labour principles, sourcing locally whenever feasible, and contributing to the community both through education and preservation initiatives can bolster the park's economic viability (Smith et al., 2021).

Interactions with locals and tourists on sustainability practices* open up participation in environmental conservation (Tauro et al., 2021). Conservation messages integrated education programs, interactive exhibits and sustainability-oriented attractions can create consciousness, and encourage conservation solutions among the visitors. While, no doubt, fostering sustainability and environmental aspects has become a regulatory matter for a Universal Studio theme park planned for construction in Aruba, such integration is also a component that ensures the project's continuous operating and development success. The overall outcome of embracing due practices in sustainable development includes the minimization of environmental degradation, protection of Aruba's natural resources, along new standards for ecotourism on Aruba Island.

2.6 The importance of using economic impact models to forecast job creation, tourism growth, and revenue generation

The application of economic impact models is vital for the accurate estimation of job creation, tourism growth, and revenue-generating that occur with mega developments such as a Universal Studio theme park in Aruba (Kakar and Khan, 2020). Such models are essential tools for policymakers, investors, and stakeholders to comprehend the possible economic impacts of such a project, informed decision-making and strategic planning are as such, made possible (Kakar and Khan, 2020).

Job Creation Forecasting

Economic Impact Models can consider a direct, indirect and induced job that is defined when funds come from the development of a well (Dell'Anna, 2021). The direct jobs are those who work within the park itself, the indirect jobs come from the park demanding goods and services from local businesses and the induced employment results from the spending by workers from either direct or indirect positions in the park. For instance, a model could indicate that for direct employment opportunities at the theme park and generate two others from the local economy for the sake of serving stakeholders for determining the wider economic benefits associated with employment (Spadaro et al., 2023).

Tourism Growth Projections

The models are also essential in predicting the rise of tourist arrivals, and the influence of the same as regards their economic impact on the local economy (Gyamfi et al., 2021). Evaluating visits by analyzing figures from other attractions helps economic impact models to give information on the anticipated surge in visitors, expenditure trends, and cases of seasonal fluctuations. This simplifies the task of infrastructure and service development planning while assuring that demand can be handled without any hassle and the tendency towards tourism and the hospitality industry will escalate (Gyamfi et al., 2021). For instance, a model could be used to estimate a 10-15% growth in tourist inflows this would imply specific revenue forecasts generated for the hospitality sector.

Revenue Generation Estimates

Economic models of impact present very specific revenue streams that a theme park can source (Vogel, 2020). This also encompasses such forms of revenues such as revenues generated directly from ticket sales, merchandise, and spending within the park itself as well as those derived from other forms of revenues by increasing the demand for local accommodation, dining, and other services. These models can also approximate the broader impact on the local and national economy by introducing multipliers such as enhanced tax revenues and GDP growth. For instance, a model might show that the theme park could add 1-2% to the local GDP, providing some solid quantitative evaluations for determining the project's economic feasibility.

Strategic Planning and Investment Justification

Macroeconomic impact models also forecasts are critical for strategic plan, for developing of infrastructure, service and marketing strategies that will optimize benefits for the theme park. Secondly, they are essential in gaining investment by estimating the likely returns of the planned development which gives investors the confidence to invest in the project.

2.7 Theoretical Overview

Regional Economic Development Theory

This theory is concerned with issues about what contributes to the economic growth and development of a certain region (Calero and Turner, 2019). The introduction of such a major entertainment site as a Universal Studio theme park can be a growth pole triggering economic activity not only in the park itself but also in the neighbouring areas. From the growth pole theory, such a setting may create agglomeration economies where clustering industries and services along the theme park encourage efficiencies and innovation within the local economy (Calero and Turner, 2019).

Tourism Economics

Tourism economics studies the impact of tourism on the economy of a destination. The establishment of Universal Studio in Aruba would likely cause an upward shift of the destination demand curve which would result in increase in tourist arrivals, length of stay, and spending per tourist. The concept of the multiplier effect, an important concept in tourism economics will be operating in terms of further spending in the economy with the initial tourist spending as it is further trickling down in the economy thus inducing further economic activities (Robertico and Yang, 2022). Secondly, this multiplier effect can greatly magnify the total economic impact of the theme park on the economic system of Aruba.

Environmental Economics

Environmental economics provides a basis for the assessment of environmental costs and benefits which any economic development project will imply (Spash, 2020). It is geared towards the imperativeness of sustainable development and maintaining equilibrium between the economy and our environment. As deduced from the above analysis it means that environmental economics principles that have been applied in such projects as Universal Studio in Aruba entail the calculations of the possible environmental impacts using a cost-benefit analysis that considers both the initial short-term economic gains and the sustainability of the ecosystem of the island (Spash, 2020).

Input-Output Models

Given a regional economy, the impact of new investments on that economy can be predicted by using input-output models (Faturay et al., 2020). Evaluating the different components of the economy and the interconnections among them is integral to the forecasting of the direct, indirect, and induced employment, income, and even GDP benefits engendered by the theme park. This method can reveal the scope of the impact of park operations on different components of Aruba's economy, ranging from construction, tourism, retail, and services, as well as the most affected affiliates described above (Faturay et al., 2020).

2.8 Literature Gap

Many of the current works examine large countries or regions with great numbers of citizens and highly differentiated economies (Solaimani and Sedighi, 2019). The a large gap in the studies which focus on the impacts of large theme parks on small island economies, where the relative impact may be more dominating and the absorptive capacity and adaptive difference is considerable. The next development the world requires is to examine particular issues and opportunities which small islands can have in hosting huge entertainment centres.

While there is research demonstrating the short-term effects that theme parks have on their surrounding environment, be it during the construction phase and/or when operations get underway, very little attention is paid to their long-term sustainability (Nita, Fineran and Rozylowicz, 2022). First, small island ecosystems have been subjected to cumulative effects of tourism and development pressure over time, but unfortunately, the literature does not pay sufficient attention to it. Aruba is an island and further research is required in regards to how other islands like Aruba manage and mitigate these long-term environmental challenges as well as utilise the benefits of theme park development.

2.9 Summary

In summary, opportunities available within the proposal to erect a Universal Studios theme park in Aruba include economic benefits through employment and tourism expansion accompanied by significant questions of environmental sustainability and socio-cultural impacts. Theme park development is expected to create thousands of direct and indirect jobs from construction to operation and operations; London will witness a drastic change in their economic sector. One of the main impacts of Universal Studio theme park in Aruba is that it is bound to drastically increase tourist arrivals, increase length of stay and counter some of the seasonality problems in the tourism demand.

3. Methodology

3.1 Introduction to Methodology

The evaluation approach of the opening of Universal Studio in Aruba is a thorough economic analysis of the possible benefits, costs, and a thorough economic analysis of the possible benefits, costs, and overall impact on the local economy, tourism industry, and community. This part has been presenting a multi-technique methodology that has employed various analytical tools and sources of information so that the project's possible implications can be understood in a holistic manner.

3.2 Research Approaches

In the economic impact assessment of establishing a Universal Studios theme park in Aruba, the applied methodology is a deductive research approach under an encompassing analytical framework. The methodology is designed to systemically evaluate the possible economic effects, costs and wider implications for the local economy, tourism industry and community through a structured and theory-driven analysis (An and Alarcón, 2020). At the heart of this methodology lies a deductive approach that begins by formulating hypotheses based on existing theories and models which are relevant to economic impact assessments. It mainly employs quantitative data collection and analysis to test these hypotheses, hence, leading to a concreted, impartial result of trial evaluation (Bui Thanh Khoa, Bui Phu Hung and Mohsen Hejsalem Brahmi, 2023).

Such a method employs existing economic theories along with empirical data and, therefore, permits detailed comparison of expected impact thanks to knowledge of similar projects from all around the world to guide forecasting and advice.

The methodology integrates economic impact assessments, cost-benefit analyses, stakeholder engagements, market analyses, scenario planning, sustainability assessments, and financial modelling (Biancardo et al., 2022). It seeks to cover the whole spectrum of possible effects, from direct, indirect, and induced economic effects to environmental and social aspects. Such a structured approach guarantees that decisions are made considering all project implications, in line with economic, social and environmental targets to deliver maximum benefits to Aruba and its population (Alzoubi, 2022).

3.3 Research Onion

Figure 3.1: Research onion

On the outermost layer, philosophies like Positivism, Realism, Interpretivism etc. are observed, which form the basis of the researcher's understanding of reality and knowledge. The latter philosophies dictate the subsequent decisions on research design. Going inward to 'Approaches', there are terms Deductive and Inductive respectively, which were discussed before. This is the reasoning of the research process either it starts with a theory which is tested against observations (deductive) or it builds theories based on observed data (inductive).

The ‘Strategies' layer encompasses different methodologies such as Experiments, Surveys, Case Studies, Action Research, Grounded Theory, Ethnography, and so on (Al-Ababneh, 2020). These strategies determine the way the research is carried out, frequently reliant on the approach adopted. ‘Choices' include whether a researcher selects Mono method, Mixed method, or Multi-method in the study, depending on both the research strategy and overarching approach.

3.4 Quantitative and Positivism

Positivism is a philosophical stance which claims that the scientific method can be applied to the social world (Morin, Olsson and Atikcan, 2021). It is based on the assumption that the social world can be objectively measured using the same scientific methods as those employed in the natural sciences. In order to meet the highest availability, simplicity, and flexibility, the survey will be developed using the Google Forms tool. The main objective of the questionnaire is to collect demographic information, travel intentions, spending behaviour, as well as the perception of respondents on the potential economic impact of Universal Studios on the local economy (Tavitiyaman et al., 2021). The form will be crafted to be thoughtful in avoiding ambiguity, unnecessary verbosity and having unbiased wording.

The representative sample of participants will include various stakeholders e.g., potential tourists, local business owners and the tourism sector employees in order to obtain a wide-range of views. The form will be disseminated through many online channels that can reach these different groups which are: tourism forums, local business networks, social media, and email campaigns that will be directed at individuals who have shown interest in Aruba as a travel destination. In the period after, the responses from Google Forms will be exported and imported to SPSS for a thorough analysis (Onwuegbuzie and Johnson, 2021). SPSS is selected due to its wide range of statistical tools and friendly user interface which is relevant for the handling of big data and many statistical tests.

The initial data cleaning will consist of verifying missing values, duplicates and outliers which could affect the analysis (Borrohou, Fissoune and Badir, 2023). Descriptive statistics will be utilized to summarize the data by presenting mean values, standard deviations, and shapes of distributions for different variables.

The essence of the analysis will be on inferential statistical tests in order to determine the possible economic impact of Universal Studios. T-tests are used to compare two mean values (e.g. economic impact perceived between residents and non-residents), while ANOVA is employed for more than two groups comparison. The regression analysis can be used to apprehend the relationship between potential spending at Universal Studios and variables like income level, distance travelled to Aruba or travel behaviour before.

3.5 Sampling Criteria

Population

Figure 3.2: Sample size

With inputs containing a margin of error of 5%, a confidence level of 95%, and an expected population size of 150, the recommended sample size is determined to be 109 individuals. This sample size is statistically significant to make sure that the survey results will represent the larger population with a high degree of accuracy. A key point to remember is that population size input implies a concentrated group can be a specific demographic or a subset of Aruba community stakeholders.

These sampling criteria must be applied by making use of a random sampling method to guarantee that each member of the target population has an equal chance of being selected thereby reducing the likelihood of selection bias. Besides, a modification could be taken into account to allow for the possibility of non-response since this is a typical problem of survey studies (Zahl-Thanem, Burton and Vik, 2021).

Sampling Framework

To ensure a proper sampling framework in assessing the economic impact of a Universal Studios theme park in Aruba, the variety of potential visitors must be taken into account, especially their age and country of origin. The framework should disaggregate these demographics to achieve holistic representation. Age groups are defined by the majority of their target audience, the typical visitor demographics of theme parks.

It has to be balanced with equal representation of families, teens, young adults, and seniors. In the hierarchy of the country stratification, the emphasis should be laid on the primary tourist sources of Aruba, taking into account the percentage which each one contributes to the number of tourists. The sampling process is going to be implemented by a multi-stage approach, making use of quota sampling to attain demographic representativeness, then followed by random selection within strata to achieve unbiased participant selection (Krishna Gopal Narayan, Dharmendra Kumar Sinha and Dhirendra Kumar Singh, 2023). Recruitment will adjust to the preferred channels of each demographic and surveys will be culturally adapted and translated as needed. This thoughtful design will ensure a thorough examination, taking into account the diverse economic effects linked to the age and nationality of park visitors, but also respecting the ethical code and cultural sensitivity.

Sampling Size

The sample size of 109 for the economic impact of a Universal Studios theme park in Aruba is based on statistics and practical considerations. This figure is computed through an online sample size calculator that factors in a 5% margin of error and a high confidence level of 95%-parameters that lie between precision and manageability. While a random sampling method would certainly give the most representative sample, limitations of researchers like resource constraints and timing may impede it and only a convenience sampling approach may suffice. Convenience sampling being more vulnerable to selection bias, offers efficiency and can be used when faced with logistical challenges or when the target population is hard to reach (Penn, Petrolia and J. Matthew Fannin, 2023). Considering the digital distribution of the survey, the outreach is large, thus some of the drawbacks of convenience sampling can be prevented. However, the possibility of non-representativeness should be admitted, and conclusions should be drawn considering that context. This sample size justifies its appropriateness for the research objectives, the results will have statistical validity and the practicalities of data collection will be recognized.

Validity

Validity is a critical component in a study of the possible economic impact of Universal Studios on Aruba since the conclusions drawn should be an accurate representation of reality. The study design must include content validity with the economic factors of job creation, stimulation of local commerce, and tourism influx taken into account. The construct validity has to ensure that the metrics used reflect the economic impact, which is in line with the economic benchmarks and theories. Criterion validity is fundamental for confirming that the outcomes of the study like expected employment rates match the actual post-implementation data.

With the control of extraneous variables, Universal Studios can be isolated from other factors and the relationship attached to it with the economy is thus established. The internal validity is also important since the results should be generalizable to similar tourism and economic contexts. Increasing validity entails careful survey design, likely including consultation with experts, pre-testing to refine the survey instruments, triangulation to corroborate findings across different data sources, and statistical controls to adjust for confounding factors.

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