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The Macroeconomic Determinants of International Casino Travel: Evidence from South Korea’s Top Four Inbound Markets

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  • Hyunduk Suh

    (Department of Economics, Inha University, 404 Building 6, Incheon 22201, Korea)

  • Sung-Bum Kim

    (College of Business Administration, Inha University, 421B Building 6, Incheon 22201, Korea)

Abstract

This study investigates the macroeconomic determinants behind the number of foreign visitors to Korean casinos arriving from major source countries, namely Japan, Mainland China, Hong Kong SAR and Taiwan. Using monthly data from 2006 to 2016, we utilized a Structural Vector Autoregression (SVAR) model to investigate the dynamic effects of macroeconomic factors on the number of casino visitors. Estimation results supported the conclusion that visitors from Japan and Mainland China—who account for approximately three quarters of the total number of foreign casino visitors—were affected by macroeconomic or financial indicators such as changes in oil prices, exports and exchange rates (Japan), exports and short-term interest rates (Mainland China). In contrast, visitors from Hong Kong SAR did not seem to be influenced by any of these factors. We also found that the MERS (Middle East Respiratory Syndrome) outbreak in Korea in 2015 had a significant adverse effect on casino visitors from all regions. Implications and suggestions for future studies are provided along with the results of this study.

Suggested Citation

  • Hyunduk Suh & Sung-Bum Kim, 2018. "The Macroeconomic Determinants of International Casino Travel: Evidence from South Korea’s Top Four Inbound Markets," Sustainability, MDPI, vol. 10(2), pages 1-18, February.
    • Handle: RePEc:gam:jsusta:v:10:y:2018:i:2:p:554-:d:132655
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    Cited by:

    1. Wei Fu & Shengnan Wei & Jue Wang & Hak-Seon Kim, 2022. "Understanding the Customer Experience and Satisfaction of Casino Hotels in Busan through Online User-Generated Content," Sustainability, MDPI, vol. 14(10), pages 1-18, May.
    2. Woraphon Yamaka & Xuefeng Zhang & Paravee Maneejuk, 2021. "Analyzing the Influence of Transportations on Chinese Inbound Tourism: Markov Switching Penalized Regression Approaches," Mathematics, MDPI, vol. 9(5), pages 1-23, March.
    3. Woo‐Hyuk Kim, 2018. "Performance drivers in the casino industry of South Korea," Asian-Pacific Economic Literature, The Crawford School, The Australian National University, vol. 32(2), pages 126-134, November.
    4. Jun Yu & Xiaobin Zhang & Hak-Seon Kim, 2023. "Using Online Customer Reviews to Understand Customers’ Experience and Satisfaction with Integrated Resorts," Sustainability, MDPI, vol. 15(17), pages 1-14, August.

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