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Tourism's Impact on Long-Run Mexican Economic Growth

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Author Info

  • Edgar J Sanchez Carrera

    ()
    (University of Siena)

  • W. Adrian Risso

    ()
    (University of Siena)

  • Juan Gabriel Brida

    ()
    (Free University of Bolzano, Italy.)

Abstract

Tourism is one of the most important factors in the productivity of Mexican economy with significant multiplier effects on economic activity. This paper investigates possible causal relationships among tourism expenditure, real exchange rate and economic growth by using quarterly data. Johansen cointegration analysis shows the existence of one cointegrated vector among real GDP, tourism expenditure and real exchange rate where the corresponding elasticities are positive. The tourism-led growth hypothesis is confirmed through cointegration and causality testing. Tourism expenditure and Real Exchange Rate (RER) are weakly exogenous to real GDP. A modified version of the Granger Causality test shows that causality goes unidirectionally from tourism expenditure and RER to real GDP. Impulse response analysis shows that a shock in tourism expenditure produces a short fall and then a positive effect on growth.

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Bibliographic Info

Article provided by AccessEcon in its journal Economics Bulletin.

Volume (Year): 3 (2008)
Issue (Month): 21 ()
Pages: 1-8

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Handle: RePEc:ebl:ecbull:eb-07c20155

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Keywords: economic growth Johansen cointegration test Granger causality tourism-led growth hypothesis.;

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References

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Cited by:
  1. Chang, C-L. & Khamkaew, T. & McAleer, M.J., 2010. "IV Estimation of a Panel Threshold Model of Tourism Specialization and Economic Development," Econometric Institute Research Papers EI 2010-30, Erasmus University Rotterdam, Erasmus School of Economics (ESE), Econometric Institute.
  2. Juan Gabriel Brida & Silvia London & Mara Rojas, 2013. "A Dynamic Model of Tourism and Economic Growth: the Role of Physical and Human Capital," Economics Bulletin, AccessEcon, vol. 33(2), pages 1361-1373.
  3. Theodore Panagiotidis & Thomas Panagiotou & Maurizio Mussoni, 2012. "Tourism Led Growth: Evidence from Panel Cointegration Tests," Working Paper Series 74_12, The Rimini Centre for Economic Analysis.
  4. Camelia Surugiu & Marius-Razvan Surugiu, 2011. "Causality Between Tourism Exports And Trade Openness: Empirical Analysis For Romanian Tourism," Revista Tinerilor Economisti (The Young Economists Journal), University of Craiova, Faculty of Economics and Business Administration, vol. 1(17), pages 100-109, November.
  5. Mina Dragouni & George Filis & Nikolaos Antonakakis, 2013. "Time-Varying Interdependencies of Tourism and Economic Growth: Evidence from European Countries," FIW Working Paper series 128, FIW.
  6. Mahalia Jackman & Troy Lorde, 2010. "On the Relationship between Tourist Flows and Household Expenditure in Barbados: A Dynamic OLS Approach," Economics Bulletin, AccessEcon, vol. 30(1), pages 472-481.
  7. Stefania Lionetti & Juan Gabriel Brida & Wiston Adrián Risso, 2009. "Long run economic growth and tourism: inferring from Uruguay," Quaderni della facoltà di Scienze economiche dell'Università di Lugano 0901, USI Università della Svizzera italiana.
  8. Paresh Kumar Narayan & Susan S Sharma & Deepa Bannigidadmath, . "Does Tourism Predict Macroeconomic Performance in Pacific Island Countries?," Financial Econometics Series 2013_03, Deakin University, Faculty of Business and Law, School of Accounting, Economics and Finance.
  9. Kadiyali, Vrinda & Kosová, Renáta, 2013. "Inter-industry employment spillovers from tourism inflows," Regional Science and Urban Economics, Elsevier, vol. 43(2), pages 272-281.
  10. Nuno Carlos LEITÃO & Muhammad SHAHBAZ, 2012. "Migration and Tourism Demand," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania - AGER, vol. 0(2(567)), pages 39-48, February.
  11. Cellini, Roberto & Cuccia, Tiziana, 2009. "Museum and monument attendance and tourism flow: A time series analysis approach," MPRA Paper 18908, University Library of Munich, Germany.
  12. Juan Gabriel Brida & Diego Giuliani, 2012. "Empirical assessment of the tourism-led growth hypothesis: the case of the “Tirol-Südtirol-Trentino†Europaregion," DISA Working Papers 2012/02, Department of Computer and Management Sciences, University of Trento, Italy, revised Mar 2012.
  13. Brida, Juan Gabriel & Barquet, Andrea & Risso, Wiston Adrián, 2009. "Causality between Economic Growth and Tourism Expansion: Empirical Evidence from Trentino - Alto Adige," MPRA Paper 25316, University Library of Munich, Germany, revised 14 Dec 2009.
  14. Jalil, Abdul & Mahmood, Tahir & Idrees, Muhammad, 2013. "Tourism–growth nexus in Pakistan: Evidence from ARDL bounds tests," Economic Modelling, Elsevier, vol. 35(C), pages 185-191.
  15. Ronald Kumar, 2014. "Exploring the nexus between tourism, remittances and growth in Kenya," Quality & Quantity: International Journal of Methodology, Springer, vol. 48(3), pages 1573-1588, May.
  16. Nuno, Carlos Leitão & Muhammad, Shahbaz, 2011. "Migration and Tourist Flows," MPRA Paper 34905, University Library of Munich, Germany, revised 12 Nov 2011.
  17. Brida, Juan Gabriel & Pereyra, Juan Sebastián & Such, María Jesús & Pulina, Manuela, 2011. "Causalidad entre turismo y crecimiento económico de largo plazo: una revisión crítica de la literatura econométrica
    [Causality between tourism and long-term economic growth: a critical review o
    ," MPRA Paper 37332, University Library of Munich, Germany, revised 2011.

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