46th Congress of the European Regional Science Association: "Enlargement, Southern Europe and the Mediterranean", August 30th - September 3rd, 2006, Volos, Greece
Islands are attractive places for tourists and most islands can be, sooner or later, requested by an increasing touristic demand. But islands are also places where natural capital has very defined limits. The aim of this paper is to assess the carrying capacity of islands in terms of water in relation to the touristic demand. We use an Input-Output Table Model and expand it to include the use of water by the different sectors and by the households. The model is estimated for the Azores islands using cross entropy methods. The structure of the model is obtained from the Input-Output Table of the Region. The data to estimate the model for each island comes from the employment and production of the companies in each island. Finally we simulate the model for each island for different levels of water supply accessible at different costs and discuss the competitiveness of the islands' touristic sector and their sustainability.