Sead Baraku
(https://orcid.org/0009-0001-4625-7747)
Faculty of Economy, “Luigj Gurakuqi” University, Shkodër, Albania, 4001;
E-mail: seadbaraku@unishk.edu.al
Alkida Hasaj
(https://orcid.org/0009-0001-5081-5019)
Faculty of Economy, “Luigj Gurakuqi” University, Shkodër, Albania, 4001;
E-mail: alkida.hasaj@unishk.edu.al
Abstract
The study explores the nonlinear effects of transhumance on tourism income diversification in rural mountain regions of the Western Balkans. While tourism is widely recognized as a driver of economic diversification, little attention has been paid to the role of traditional practices as dynamic and potentially nonlinear contributors to economic outcomes. Building on tourism systems theory and the experience economy framework, the study conceptualizes transhumance as an active component of tourism systems, with impact varying by intensity. The analysis uses a balanced panel dataset covering 2023–2025, compiled from harmonized secondary sources, including INSTAT, FAO, the World Bank, UNWTO, and regional datasets. A fixed-effects panel model is used along with a quadratic specification to capture nonlinear dynamics and identify threshold effects. The results show a strong inverted-U shape between transhumance intensity and tourism income diversification. While transhumance increases diversification at lower and moderate levels, its additional benefit declines after a certain point, indicating diminishing returns. These results confirm that traditional practices are economically important but need to be integrated at the right levels within tourism systems. The study contributes by introducing a nonlinear analytical framework for culturally embedded practices, identifying threshold effects, and providing empirical evidence from an under-researched region, with important implications for sustainable tourism development and policymaking.
Keywords: Tourism income diversification, Transhumance, Nonlinear effects, Rural tourism, Mountain regions, Western Balkans, Sustainable tourism development
Introduction
Tourism-driven economic diversification is widely regarded as beneficial, particularly in rural and peripheral regions. Recent research indicates that these effects are neither straightforward nor automatic, as they depend on the level, structure, and context of tourism development. Consequently, tourism systems are increasingly conceptualized as complex adaptive systems characterized by feedback loops, threshold effects, and diminishing returns (Baggio, 2020). This perspective challenges traditional linear assumptions and necessitates more nuanced approaches that account for the dynamic interactions between tourism activities and local economies.