Istituto di Economia Internazionale - Determinants of Tourism Development: Empirical Evidence from three Developing Countries

Recent Articles

Read more about our latest published articles.

Review’s Archive

Corresponding Author:
Sheilla Nyasha, Department of Economics, University of South Africa, Pretoria, South Africa

Coauthors:
Nicholas M. Odhiambo , Department of Economics, University of South Africa, Pretoria, South Africa

Determinants of Tourism Development: Empirical Evidence from three Developing Countries

Volume 74 - Issue 3, August 2021
(pp. 335-368)
JEL classification: Z30, Z32
Keywords: Tourism Development, Determinants, South Africa, Brazil, Vietnam, ARDL

Abstract

This study examines the key determinants of tourism development in South Africa, Brazil and Vietnam during the period 1995- 2018. Despite the growing empirical literature on the determinants of tourism development from a number of countries, these countries have remained understudied. The study uses two proxies, namely: tourism revenue (TR) and the number of international tourist arrivals (TA), to measure the level of tourism development. Using the ARDL bounds-testing approach, the results show that the determinants of tourism development differ from country to country and over time. In addition, the study shows that the determinants depend on the proxy used to measure the level of tourism development. Overall, the study found that the positive drivers of tourism in these countries are tourist disposable income, financial development, trade openness and political stability, while the negative drivers include exchange rate, price level and carbon emissions.

Read the full article

Download the article in PDF format to read and print.

Bibliography

Ang, J.B. and W.J. McKibbin (2007), “Financial Liberalization, Financial Sector Development and Growth: Evidence from Malaysia”, Journal of Development Economics, 84(1), 215-233.

Asongu, S.A., J.I. Uduji and E.N. Okolo-Obasi (2019), “Tourism and Insecurity in the World”, International Review of Economics 66, 453-472.

Bojanic, D.C. and M. Lo (2016), “A Comparison of the Moderating Effect of Tourism Reliance on the Economic Development for Islands and other Countries”, Tourism Management, 53(C), 207-214.

Fayissa, B., C. Nsiah and B. Tadasse (2008). “Impact of Tourism on Economic Growth and Development in Africa”, Tourism Economics, 14(4), 807-818.

Gebrehiwot, D.B. and H. Gebre (2015), “Determinants of Tourism Development in Aksum Town”, International Journal of Current Research, 7(01), 12150-12157.

Gerakis, A.S. (1965), “Effects of Exchange-Rate Devaluations and Revaluations on Receipts from Tourism”, International Monetary Fund Staff Papers, 12(3), 365-384.

Gormus, S. and I. Gocer (2010), “The Socio-economic Determinant of Tourism Demand in Turkey: A Panel Data Approach”, International Research Journal of Finance and Economics, 55, 88-99.

Heston, A., R. Summers and B. Aten (2006), “Penn World Table Version 6.2”, Center for International Comparisons of Production, Income and Prices at the University of Pennsylvania.

Holzner, M. (2011), “Tourism and Economic Development: The Beach Disease?”, Tourism Management, 32(4), 922-933.

Johansen, S. (1988), “Statistical Analysis of Cointegration Vectors”, Journal of Economic Dynamics and Control, 12(2-3), 231-254.

Johansen, S. and K. Juselius (1990), “Maximum Likelihood Estimation and Inference on Cointegration with Applications to the Demand for Money”, Oxford Bulletin of Economics and Statistics, 52(2), 169-210.

Katircioglu, S., S. Katircioğlu and M. Altinay (2018), “Interactions between Tourism and Financial Sector Development: Evidence from Turkey”, The Service Industries Journal, 38(9-10), 519-542.

Kaufmann, D., A. Kraay and M. Mastruzzi (2006), “Governance Matters VI: Aggregate and Individual Governance Indicators 1996-2006”, Policy Research Working Paper No. 4280. World Bank, Washington: DC.

Kibara, O., N. Odhiambo and J. Njuguna (2012), “Tourism and Economic Growth in Kenya: An Empirical Investigation”, International Business & Economics Research Journal (IBER), 11(5), 517-528.

Lim, C. (1997), “Review of International Tourism Demand Models”, Annals of Tourism Research, 24, 835-849.

Ma, E., C. Qu, A. Hsiao and X. Jin (2015), “Impacts of China Tourism Law on Chinese Outbound Travelers and Stakeholders: An Exploratory Discussion”, Journal of China Tourism Research, 11(3), 229-237.

Malec, L. and J. Abrhám (2016), “Determinants of Tourism Industry in Selected European Countries: A Smooth Partial Least Squares Approach”, Economic Research- Ekonomska Istraživanja, 29(1), 66-84.

Mohaidin, Z., K.T. Wei and M. Ali Murshid (2017), “Factors Influencing the Tourists’ Intention to Select Sustainable Tourism Destination: A Case Study of Penang, Malaysia”, International Journal of Tourism Cities, 3(4), 442-465.

Morley, C.L. (1994), “The Use of CPI for Tourism Prices in Demand Modeling”, Tourism Management, 15(5), 342-346.

Nyasha, S. and N.M. Odhiambo (2020), “Does Remittance Inflow Granger-Cause Economic Growth in South Africa? A Dynamic Multivariate Causality Test”, The Review of Black Political Economy, 47(1) 86-103.

Odhiambo, N.M. (2014), “Energy Dependence in Developing Countries: Does the Level of Income Matter?”, Atlantic Economic Journal, 42(1), 65-77.

Özlem Önder, A., A. Candemir and N. Kumral (2009), “An Empirical Analysis of the Determinants of International Tourism Demand: The Case of Izmir”, European Planning Studies. 17(10), 1525-1533.

Parida, Y., P. Bhardwaj and J. Chowdhury (2017), “Determinants of Tourism in Indian States: An Empirical Analysis”, Tourism Review, 72(3), 330-343.

Park, J.H., H.B. Kim, S.K. Lee and S.C.S. Jang (2011), Wealth Effect and Demand for Outbound Tourism, Proceedings of the 16th Annual Graduate Student Research Conference in Hospitality and Tourism, Houston, Texas, 6-8 January.

Pedak, M.O. (2018), “The Effect of Tourism on GDP”, A dissertation submitted to Jonkoping University.

Pesaran, M.H. and Y. Shin (1999), An Autoregressive Distributed Lag Modelling Approach to Cointegration Analysis, in: S. Strom (Ed.), “Econometrics and Economic Theory in the 20th Century: The Ragnar Frisch Centennial Symposium”, Cambridge University Press, Chapter 11, 1-31.

Pesaran, M.H., Y. Shin and R. Smith (2001), “Bound Testing Approaches to the Analysis of Level Relationship”, Journal of Applied Econometrics, 16(3), 289-326.

Pratt, S. (2015), “The Economic Impact of Tourism in SIDS”, Annals of Tourism Research 52, 148-160.

Raghavendra, D.V., V. Shilpa and S. Vijayachandra Reddy (2016), “Determinants of Tourism Demand in India”, International Journal of Humanities and Social Science Invention, 5(5), 20-26.

Ren, T., M. Can, S.R. Paramati, J. Fang and W. Wu (2019), “The Impact of Tourism Quality on Economic Development and Environment: Evidence from Mediterranean Countries”, Sustainability, 11, 2296.

Shafiullah, M., L.E. Okafor and U. Khalid (2019), “Determinants of International Tourism Demand: Evidence from Australian States and Territories”, Tourism Economics, 25(2), 274-296.

Smeral, E. (2003), Die Zukunft des internationalen Tourismus: Entwicklungsperspektiven für das 21. Jahrhundert, WIFO: Vienna.

Sofronov, B. (2017), “The Economic Impact on Global Tourism”, Annals of Spiru Haret University, Economic Series, Universitatea Spiru Haret, 17(2), 127-139.

Song, H. and G. Li (2008), “Tourism Demand Modeling and Forecasting: A Review of Recent Research”, Tourism Management, 29(2), 203-220.

Song, H., S. Lin, X. Zhang and Z. Gao (2010), “Global Financial/Economic Crisis and Tourist Arrival Forecasts for Hong Kong”, Asia Pacific Journal of Tourism Research, 15, 223–242.

Songling, Y., M. Ishtiaq and B.T. Thanh (2019), “Tourism Industry and Economic Growth Nexus in Beijing, China”, Economies 7(1), 1-15.

UNWTO (2020), World Tourism Barometer and Statistical Annex, Vol. 18, Issue 1.

Vencovska, J. (2014), “The Determinants of International Tourism Demand”, A dissertation submitted to Charles University in Prague.

World Bank (2020), World Bank DataBank, acessed April 5, <https://databank.worldbank.org/home.aspx>.

Recent Articles

Review’s Archive

Determinants of Tourism Development: Empirical Evidence from three Developing Countries

Abstract

Read the full article

Bibliography

Register your account

Authors’ login

Institute for International Economics of the Genoa Chamber of Commerce

Institute for International Economics
of the Genoa Chamber of Commerce