Quality and endogenous tourism: An empirical approach

We propose a theoretical model and an empirical study that highlight the role of quality of tourism services and endogenous tourism in long-run economic growth. We study a theoretical growth model of international trade where tourism is the growth engine and quality of tourism services has a positive impact on long-term growth. We also provide an empirical analysis to test the relation between tourism, quality and economic growth in Spain over the period 1970–2010. Our results show that in the long run, tourist arrivals, quality of tourism accommodations, and foreign GDP have a positive effect on Spanish GDP. In the short term, changes in economic growth appear to lead to growth in tourist arrivals. Our findings support a two-way causal relationship between real GDP growth and tourism growth in Spain.     

Productivity growth and income in the tourism sector: Role of tourism demand and human capital investment

This paper proposes a model for the demand for tourism in the context of a developing country. The parameters of the model are a tourist sector characterised by monopolistic competition, where human capital is the main factor of production and hotels have market power. Additionally land use is marked by demand from both agricultural and tourism sectors. From the household side, a simplified OLG approach is developed to consider consumption, human activity and the number of children. A dynamic framework is therefore identified to investigate the long-run consequences of increasing labor productivity and lowering the fertility rate. If the supply-side policy leads to economic growth, the tourism led growth hypothesis is theoretically confirmed. It is concluded that an increase in labor productivity generates positive growth effects only if the demand for tourism is elastic, otherwise negative results arise.     

Modelling and forecasting daily international mass tourism to Peru

Peru is a South American country that is divided into two parts by the Andes Mountains. The rich historical, cultural and geographic diversity has led to the inclusion of ten Peruvian sites on UNESCO's World Heritage List. For the potentially negative impacts of mass tourism on the environment, and hence on future international tourism demand, to be managed appropriately require modelling growth rates and volatility adequately. The paper models the growth rate and volatility (or the variability in the growth rate) in daily international tourist arrivals to Peru from 1997 to 2007. The empirical results show that international tourist arrivals and their growth rates are stationary, and that the estimated symmetric and asymmetric conditional volatility models all fit the data extremely well. Moreover, the estimates resemble those arising from financial time series data, with both short and long run persistence of shocks to the growth rate in international tourist arrivals.     

Analysis of tourism trends in Spain

This paper studies the evolution of the international tourism demand for Spain in order to forecast its trends. The analysis is carried out within the framework of structural time series models that are formulated in terms of unobserved components stochastically specified. A measure of the underlying rate of growth of the international demand is derived in order to evaluate whether the sector is in a period of expansion or recession. The empirical results show that the worst period of the crisis suffered at the end of the 80s by the industry is over now and the future prospects are optimistic in the short run.     

Modelling and forecasting the demand for Hong Kong tourism

The main objectives of this paper are to identify the factors which contribute to the demand for Hong Kong tourism with the aid of econometric models and to generate forecasts of international tourism arrivals to Hong Kong for the period 2001–2008. The general-to-specific modelling approach is followed to model and forecast the demand for Hong Kong tourism by residents from the 16 major origin countries/regions and the empirical results reveal that the most important factors that determine the demand for Hong Kong tourism are the costs of tourism in Hong Kong, the economic condition (measured by the income level) in the origin countries/regions, the costs of tourism in the competing destinations and the ‘word of mouth’ effect. The demand elasticities and forecasts of tourism arrivals obtained from the demand models form the basis of policy formulations for the tourism industry in Hong Kong.     

The effect of international tourism on economic development: An empirical analysis

The expansion of international tourism in developing countries is generally considered to promote their economic development. In this paper, the impact of international tourism on economic development is modelled using an aggregate production function framework. It specifically investigates intersectoral externalities and marginal factor productivity differences between the international tourism sector and the rest of the economy. The net effect of international tourism on GDP per capita is examined via an empirical analysis of 37 developing economies. The results indicate that international tourism may positively affect economic development in these countries.     

How shark conservation in the Maldives affects demand for dive tourism

Shark-diving tourism provides important economic benefits to the Maldives. We examine the link between shark conservation actions and economic returns from diving tourism. A combined travel cost and contingent behaviour approach is used to estimate the dive trip demand under different management scenarios. Our results show that increasing shark populations could increase dive-trip demand by 15%, raising dive tourists’ welfare by US$58 million annually. This could result in annual economic benefits for the dive-tourism industry of >US$6 million. Conversely, in scenarios where shark populations decline, where dive tourists observe illegal fishing, or if dive operators lack engagement in shark conservation, dive trip demand could decrease by up to 56%. This decline causes economic losses of more than US$24 million annually to the dive tourism industry. These results highlight the dependence of the shark-diving industry on the creation and enforcement of appropriate management regimes for shark conservation.     

Economics of tourism & growth for small island countries

We theoretically analyze the impact of changes in foreign income from tourism source countries on the growth of tourism dependent small island economies. Using a general theoretical construct, we attempt to answer the question of how price elasticity of demand, income elasticity of tourist and the degree of competition in the service sector influence the economic development of small economies. One of the main results is that politicians may consider applying policies which lead to a competitive environment in the service sector to maximize growth and the consequent labor income share.     

Modelling the interdependence of tourism demand: The global vector autoregressive approach

This study develops a global vector autoregressive (global VAR or GVAR) model to quantify the cross-country co-movements of tourism demand and simulate the impulse responses of shocks to the Chinese economy. The GVAR model overcomes the endogeneity and over-parameterisation issues found in many tourism demand models. The results show the size of co-movements in tourism demand across 24 major countries in different regions. In the event of negative shocks to China’s real income and China’s tourism price variable, almost all of these countries would face fluctuations in their international tourism demand and in their tourism prices in the short run. In the long run, developing countries and China’s neighbouring countries would tend to be more negatively affected than developed countries.     

Casino tourism,economic inequality,and housing bubbles

Potential linkages among tourism, inequality, and housing are addressed for an integrated analysis in this paper, with Macao treated as a typical case. Casino tourism, albeit performing as a major key to local economic growth, is ultimately vulnerable to external shocks to gambling demand, as evidenced by the current sharp downturn in Macao. We find that faster gaming growth leads to higher income inequality while at the same time both factors are responsible for soaring housing bubbles, which constitute the very source of social tensions as in Macao. Casino tourism if not well managed may not be a panacea for all development goals. The implication for policy derived from this study is that Macao must deal with underlying issues rather than apply palliative measures. Its market failures may necessitate government interventions to ensure social equity and sustainable tourism.     

Educational tourism and its implications on economic growth in Malaysia

The effect of educational tourism on Malaysia’s economic growth is examined in this study by extending the Solow growth model. This study uses the sample from 2002:Q1 to 2014:Q4. The newly developed Bayer–Hanck combined tests for cointegration and the Granger causality test were employed to examine the long-run and causal relationships among the variables. The empirical findings suggest that economic growth, educational tourism, and other determinants are cointegrated. Educational tourism has a bi-directional causal relationship with economic growth in the short-run but there is a uni-directional Granger causality runs from educational tourism to economic growth. This study provides an essential insight for Malaysia to create policies that promote educational tourism, thereby encouraging economic growth in the long-run.     

Effects of budgetary constraints on international tourism expenditures

This paper implements a logistic transition regression model to examine the relationships between GDP per capita and international tourism expenditures across countries in 2001–2010 by types of savings regimes. While studies have focused on the effect of income on international tourism expenditures, none consider the nonlinear smooth transition status of savings and its impacts on discretionary spending and hence expenditure on tourism. The impact of income on tourism expenditures can vary under different savings regimes. The results show that in a low savings regime the effect of an increase in the GDP per capita on international tourism expenditures is more pronounced. In a high-savings regime, there is strong motivation for precautionary savings and tourism is considered a luxury; therefore such spending is crowded out by an increase in savings as GDP per capita increases. Although international tourism expenditures also increase with GDP per capita, they do so at a slower rate. These findings establish an accurate understanding of the effects of savings on international tourism expenditures.     

On the empirical relationship between tourism and economic growth

This paper studies the dynamics of economic growth and tourism evolution for 80 countries during the period 1995–2016. The variables representing economic and tourism growth are growth rates of per capita GDP and international tourist arrivals per inhabitant respectively. Using the concept of economic regime, the paper introduces a notion of distance between the dynamical paths of different countries. Then, a Minimal Spanning Tree and a Hierarchical Tree are constructed to detect groups of countries sharing similar performance. The two main clusters we find can be interpreted as two groups of countries with high and low performance in the tourism sector and are coherent with the business cycle. The evolution of such clusters shows three main stylized facts: certain countries move across clusters; the low performance cluster tends to span, while the high performance one tends to be (more) compact; the distance between the two groups increases in time.     

‘Quest for quality’ was the theme of the 7th annual Caribbean tourism conference held in Montego Bay, Jamaica, 14–17 June, 1983. David Edgell of the US travel and tourism administration reports.

The growth of inbound international tourism to the USA has been great in recent years yet recognition of its economic and other importance has not always grown at the same rate. David Edgell, Director of the Office of Policy and Planning of the US Travel and Tourism Administration, here argues the need for more coordinated policies towards tourism at the local and national level, for concomitant improved funding and for increasing efforts at all levels to attract the international traveller to the USA. This viewpoint is the substance of a speech made to the National Association of Regional Council's in Kansas City, Missouri, in May 1983. Since that date some moves have been made at the national level to increase federal funding for tourism.     

A decomposition-ensemble approach for tourism forecasting

With the frequent occurrence of irregular events in recent years, the tourism industry in some areas, such as Hong Kong, has suffered great volatility. To enhance the predictive accuracy of tourism demand forecasting, a decomposition-ensemble approach is developed based on the complete ensemble empirical mode decomposition with adaptive noise, data characteristic analysis, and the Elman's neural network model. Using Hong Kong tourism demand as an empirical case, this study firstly investigates how data characteristic analysis is used in a decomposition-ensemble approach. The empirical results show that the proposed model outperforms other models in both point and interval forecasts for different prediction horizons, indicating the effectiveness of the proposed approach for forecasting tourism demand, especially for time series with complexity.     

The contribution of social tourism to sustainable tourism: a case study of seasonally adjusted programmes in Spain

Recent policy from the European Union has attempted to justify social tourism initiatives on the basis that they lead to a more sustainable tourism industry. However, the majority of latest research in the field has been focused on the benefits for participants, with the addition of some evidence on the economic impacts of such programmes on destinations, which have pointed towards sustainability outcomes including: a longer tourism season, more even spread of demand, and longer periods of employment for tourism workers. Yet there is a lack of direct evidence linking such programme to these outcomes. This paper aimed to explore this important disconnect between policy assumptions and evidence-based outcomes through an analysis of the deseasonalising effects of the Spanish social tourism programme for older people. The research found that this programme does have an effect on the seasonal nature of employment and economic activity in most regions studied, but that the huge volume of demand from international tourists in the high seasons masks the quantitative effects in the regions with the highest seasonal concentration of international tourists. Recommendations for policy and practice in sustainable tourism are made that are transferable to many countries and regions that adopt social tourism programmes.     

Sentiment,mood and outbound tourism demand

We investigate spillover effects from sentiment and mood shocks on US outbound tourism demand from 1996 until 2013. We use the Index of Consumer Sentiment and Economic Policy Uncertainty Index as proxies for sentiment and the S&P500 as a proxy for mood. We find a moderate to high interrelationship among sentiment, mood and outbound tourism demand. More importantly, sentiment and mood indicators are net transmitters of spillover shocks to outbound tourism demand. The magnitude of spillover effects sourced by sentiment and mood is time-varying and depends on certain socio-economic and environmental events. Our results have important implications for policymakers and travel agents in their efforts to predict tourism arrivals from key origin countries and to plan their tourism strategy.     

The economic impact of tourism in SIDS

Small Island Developing States (SIDS) are faced with many challenges to economic development. Tourism is seen as a viable, and sometimes, only means of economic growth. This research compares the economic impact of tourism to seven SIDS. The research employs input output analysis, linkage analysis and a CGE model to assess the macroeconomic and sectoral impacts of increased tourism in these islands. The findings show that the transportation sector remains a key sector. The tourism income multipliers show that tourism generates a large amount of economic activity but the income that remains in the destinations is often very small. The results show that taking advantage of economies of scale maybe a way to maximize the benefits from tourism.     

Implications of a long-term increase in oil prices for tourism

It is expected that global oil prices will increase in the future. Assessing the overall economic impacts on tourism is difficult, as oil price rises will be concomitant with global changes in other commodity prices, exchange rates, and incomes. A general equilibrium perspective is therefore presented in this paper. The model couples a global general equilibrium model with a purpose-built CGE model of New Zealand, which focuses on describing tourism supply and demand in some detail. The results indicate a decrease in real gross national disposable income of 1.7% for a doubling of oil price and a 9% reduction in the real value of tourism exports. As a result of segment-specific price increases and differing income and exchange rate effects and elasticities, the reduction in demand for tourism in New Zealand by 18 segments differs substantially. The greatest reduction in demand is observed for tourists from the United Kingdom.