Can today’s services be sustained?
Assess recurring resources, current standards, maintenance and renewal.
ISLAND LIFE · TOURISM · PUBLIC SERVICES
The Economics of Living Destinations
When tourism grows, can the services that keep island life working keep pace?
A study centred on Paros asks how water, infrastructure and public finances can support residents and visitors over the long term.
THE STUDY AT A GLANCE
START WITH ONE QUESTION
What changes when a destination adds one more accommodation bed?
Its use may bring income and public revenue. It may also change demand for water and other services. The useful question is which obligations change, who pays for them, and which resources reach that institution.
01 / FCC
A practical meaning for a technical term
Fiscal Carrying Capacity (FCC) is a destination’s ability to finance the services, infrastructure and public functions that residents and tourism need, without relying on continual growth in visitor volumes or degrading environmental and social capital.
In everyday terms: can the place keep its services working, maintain what it owns and meet the obligations that come next?
Carrying-capacity approaches consider physical, environmental, social and management limits. FCC complements them by tracing the public-finance relationships. Affordability alone does not establish that development is environmentally or socially acceptable.
Follow the service, then follow the money
- 01
Activity
What changes in a particular place and period?
- 02
Service
What extra water, infrastructure or staff is needed?
- 03
Institution
Who must provide and pay for it?
- 04
Resources
Which revenues fund operation, maintenance and renewal?
Visitor spending, business income, public revenue and money available to a local service provider are different quantities. The connections need evidence.
Two questions belong together
What changes with additional demand?
Compare the extra service obligation with the additional resources available to the responsible institution.
An affordable increment can coexist with an unresolved shortfall in existing services. A large budget alone does not establish room for the next increment.
ONE SMALL EXAMPLE
When does a little more demand become a much bigger decision?
Imagine an island on a busy summer day. Residents, hotels and restaurants all need water at the same time. If the system has room to supply more, an extra request may mean mainly extra running costs. As that room disappears, the next request may require a more expensive source. Once the available sources reach their limits, paying their running costs cannot provide all the water requested.
HYPOTHETICAL ILLUSTRATION · NOT MEASURED PAROS RESULTS
A simple example: two sources, limited room
Suppose two sources each have room to produce another 100 cubic metres (m³) per day, after existing needs and a safety allowance. One cubic metre is 1,000 litres. Assume that 80 out of every 100 m³ produced reach users. Each source can therefore deliver only 80 extra m³ per day: 100 × 0.80 = 80.
Producing each extra m³ costs €1 at source A and €2 at source B. We assume A can be used first. These are assumed running-cost rates, not water bills charged to customers. The requests below are alternative scenarios, not amounts to add together or estimates of one bed’s water use.
Additional delivered water demand
Delivered160 m³/day
Still unmet40 m³/day
Variable cost of the served portion€300/day
The two sources reach their limits. €300/day pays for the served portion; the cost of meeting the whole requirement is not established.
How the calculation works
Both sources produce their full extra 100 m³. Together they deliver 80 + 80 = 160 m³ and cost €100 + €200 = €300/day. Still missing: 200 − 160 = 40 m³/day.
Illustration from Exhibit 5.3 and Appendix B. All quantities and rates are assumptions, not measurements of Paros. These running-cost figures are not a full budget for construction, maintenance, replacement or other service obligations. No additional revenue is assumed.
See the assumptions
Each source has 100 m³/day of additional gross headroom after reserve. Their variable costs are €1 and €2 per gross m³. The delivered fraction is 0.80. The cheaper source is assumed feasible to use first. Revenue, capital and costs outside these rates are excluded. Study: Exhibit 5.3 and Appendix B.
PEAK DEMAND & THE TIPPING POINT
One extra bed at the busiest moment
The timing of demand matters. A system may have room for more use on a quiet day but very little at the summer peak. Spare capacity means the service that can actually be added at that time, after existing needs and safety allowances. An annual total cannot show whether that room exists on the busiest day.
The tipping point: when the existing system can no longer meet the next request
If a service is already close to its usable limit, even a modest increase may take demand beyond it. “One extra bed” makes that question concrete. Its use does not automatically require a new plant; it matters when, where and how much additional service is needed.
Buying capacity is only the beginning
A new unit, tank or network extension has an upfront cost. It may also bring extra energy bills, inspections, servicing, repairs and eventual replacement. A grant can help pay for construction without covering those later bills. These obligations may continue through quieter months, when visitor-related receipts are lower.
Before choosing expansion, compare feasible repairs, efficiency improvements, storage, alternative supply and ways to reduce or shift peak demand. Each option has costs, limits and environmental or social consequences. This example does not choose an option for Paros.
Costs may rise in steps: a small extra requirement can sometimes bring forward a larger commitment. The last extra bed is not solely responsible for the cost of shared infrastructure: existing demand, past investment and the chosen service standard also matter. Similar thresholds may arise in other public services, but each needs its own evidence.
FCC asks two connected questions: can we keep today’s services dependable, and can we fund the response to tomorrow’s demand, including its continuing costs?
02 / THE CONTRIBUTION
What this first edition contributes
A framework for better questions
Connect activity, service needs, responsible institutions and continuing financial obligations.
A documented Paros case
Place selected accommodation, airport, business, fiscal and procurement records within their actual coverage and limitations.
Reproducible conditional examples
Show how assumptions about water delivery and source availability change the calculation. The examples can be checked without treating them as observed local results.
WHAT THE STUDY OFFERS
The purpose: dependable life in a living destination
Decisions about tourism and infrastructure should make visible who receives benefits, who finances services, which obligations persist and which environmental or social conditions remain unresolved. Both development proposals and restrictions can be examined on that basis. The relevant outcome is dependable resident life and sustainable service provision, rather than an assumed preference for more or less activity.
A CONTINUING RESEARCH PROGRAMME
Better local evidence can make the next question answerable.
The study offers a practical way to examine proposals now. Developing and comparing specific policy options requires more complete, compatible local data, together with technical assessment and public judgement. Accommodation businesses, utilities and public authorities can help by contributing clearly defined records under agreed handling arrangements. Better evidence can help businesses assess service risks, investment choices and operating plans, and help authorities compare options for sustaining public services. Participation supports more informed choices; it does not guarantee a particular policy or commercial outcome.
Accommodation businesses
Person-nights and public-network water for the same period, with meter coverage and other water sources clearly described.
Utilities and service providers
Aligned production, service demand, operating inputs, source availability and applicable revenue information.
Public authorities and local stakeholders
Clarification of accounting fields, service responsibilities, project stages and relevant local service conditions.
Start with a conversation
Please first describe the information you may be able to contribute. We can then discuss definitions, coverage, permission and appropriate handling before any records are shared. Please do not send personal, confidential or restricted records with an initial enquiry.
The first edition keeps a fixed evidence cutoff of 16 October 2026. Later evidence can support dated supplements; material errors will require transparent correction. An ongoing research programme does not mean silently changing a published edition.
03 / READ & EXPLORE
Choose how far to go
Start with a short executive summary, or follow the argument and source qualifications in the full study.
The Economics of Living Destinations
Fiscal Carrying Capacity, Tourism and the Cost of Sustainable Island Life
About the study
The author is the sole researcher, without funding or institutional support, and declares no relevant financial or non-financial interests. AI tools assisted with drafting, revision, literature discovery, citation organisation, calculation checks and proof production. No external expert review or independent engineering certification is claimed.
Based on the first-edition manuscript: Chapters 1–2 (framework), 3–4 (case and fiscal evidence), 5–6 (water and investment), 7–8 (scope and conclusions), and Appendices A–C. The literature review is selective. Source-access qualifications appear in the full study. Restricted Ministry of Tourism accommodation data are excluded.
First edition · 5 November 2026
Sharing and reuse
You may share this PDF unchanged, with attribution to Bill Marangozis and a link to the publication website. For permission to adapt or translate it, contact bmarangozis@gmail.com.