Geothermal spas as a local development factor, the case of Poland

This paper investigates whether the endogenous geothermal energy resources used for local tourism facilities are a factor of local development. We answer this research question by examining the local socioeconomic development dynamics in years 1995-2015 in the six selected Polish municipalities that established geothermal spas at different years. A model introduces the concept of switch variables, where a geothermal spa is the assumed switching factor in a municipality's socioeconomic development. The statistical procedures are adopted from factor analysis and trend estimation methodologies. Our conclusions lead to a positive assessment of a geothermal water park's contribution to a municipality's socioeconomic development.