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Tourism as a Long-Run Economic Growth Factor: An Empirical Investigation for Greece Using Causality Analysis

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  • Nikolaos Dritsakis

    (Department of Applied Informatics, University of Macedonia, Economics and Social Sciences, 156 Egnatia Street, PO Box 1591, 540 06 Thessaloniki, Greece)

Abstract

This paper empirically examines the impact of tourism on the long-run economic growth of Greece by using causality analysis of real gross domestic product, real effective exchange rate and international tourism earnings. A Multivariate Auto Regressive (VAR) model is applied for the period 1960:I-2000:IV. The results of co-integration analysis suggest that there is one co-integrated vector among real gross domestic product, real effective exchange rate and international tourism earnings. Granger causality tests based on Error Correction Models (ECMs), have indicated that there is a ‘strong Granger causal’ relationship between international tourism earnings and economic growth, a ‘strong causal’ relationship between real exchange rate and economic growth, and simply ‘causal’ relationships between economic growth and international tourism earnings and between real exchange rate and international tourism earnings.

Suggested Citation

  • Nikolaos Dritsakis, 2004. "Tourism as a Long-Run Economic Growth Factor: An Empirical Investigation for Greece Using Causality Analysis," Tourism Economics, , vol. 10(3), pages 305-316, September.
    • Handle: RePEc:sae:toueco:v:10:y:2004:i:3:p:305-316
    DOI: 10.5367/0000000041895094
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    References listed on IDEAS

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