“North Macedonian Hospitality Heaven: The Effectiveness of Technical-Industrial Zone Development from a Tourism Perspective”.

This paper explores the tourism incentive mechanism through the establishment of tourism development zones in North Macedonia. The latter promotes the operational and commercial tourism economy and derivatives that can be experienced in the context of a country with rich cultural heritage, archaeological sites intertwined with spiritual culture cultivated in monasteries and churches surrounded from the undisputed natural beauties. The evaluation of mechanism effectiveness is done through the implementation of Limited information maximum likelihood function by treating as weak instruments: value added tax (VAT), personal income tax (PIT), tourism expenditures for passenger transport items, inflation, foreign direct investments (FDIs) and remittances. It considers as main factors: international tourism arrivals, population, unemployment rate and international tourism expenditures. Comparatively, the weak instruments impact on exogenous regressors was explored through two consecutive ordinary least square regressions. The main results confirm the positive effects of tax burden exemption regarding the development of tourism sector in the technical industrial zones.