Very often a large number of moving visitors into an area pushes up the price of goods and services, meaning that local people have to pay more for food, drinks, transport etc.

While tourism is a massive revenue generator, it can negatively impact a local economy through several key mechanisms. One of the most common issues is inflation of local prices; as demand from visitors increases for food, transportation, and services, the cost of living for residents often rises to match, sometimes pricing them out of their own communities. Another significant factor is leakage, where the money spent by tourists doesn't stay in the local economy but instead flows out to international hotel chains, airlines, and foreign-owned tour operators. Additionally, tourism can lead to economic over-dependency, making a region vulnerable to sudden collapses in visitor numbers due to global events, pandemics, or changing travel trends. There is also the opportunity cost of infrastructure; governments may prioritize spending on tourist-centric projects like airports or resorts over essential public services like healthcare and education for the local population. Finally, the rise of short-term rentals can cause housing shortages and drive up property values, making it difficult for local workers to find affordable housing.