Rural Tourism and Regional Development

**81**

**Chapter 6**

**Abstract**

Rural Development and

*António Almeida and Luiz Pinto Machado*

based on tangible and intangible amenities.

nature based tourism, regional development

**1. Introduction**

rural hinterland [9].

**Keywords:** rural tourism, panel-data, investment in infrastructure,

The economic development of rural areas is still a pressing issue in most western countries, especially in peripheral areas coping with high levels of unemployment, declining farm income, depopulation and emigration of the younger and betterqualified individuals [1, 2]. In general, such regions suffer from limited options with regards to economic development outside agriculture [3–6], which led policy makers to re-think strategically the social and economic fabric of rural areas [7]. Policy measures aiming at diversifying rural economies through the development of new sectors/products [2, 8] have also been conceptualized by regional governments on islands, in an attempt to reverse the trend of decline in terms of quality of life that has been felt across rural areas. Such approach is strongly encouraged by the European Union, to "fill the gap" between the over-developed coastal areas and the

Rural Tourism: The Impact of

Rural and peripheral development is still a matter of concern in several western countries. Depopulation, low density of business activities, younger people emigration and better-qualified individuals feeling that such regions have been abandoned by the government, and incapable of moving on, are among the key indicators to "understand" rural and peripheral areas. Rural tourism has long been understood as an effective catalyst of change in depressed and deprived (of entrepreneurial capacity) areas and to explore a unique set of amenities. Because of funds directed to help private investment projects in rural tourism facilities, most peripheral areas are now relatively well endowed with key infrastructures. Nevertheless, the tourism lead approach produced mixed results due to low levels of demand in some areas and lack of a cooperative behavior among providers to maximize the opportunities offered by the wide range of attractions. In this paper, we investigate to what extent investments in infrastructure helped the rural tourism sector to attract more visitors in Madeira. Based on the panel-data approach, this paper provides insights to analyze the development path of rural tourism in Madeira and to explores how local policy makers may be the "missing link" needed to improve the sector prospects

Infrastructure Investments

## **Chapter 6**
