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Using the Panel Cointegration Approach to Analyse the Determinants of Tourism Demand in South Africa

Author

Listed:
  • Boopen Seetanah

    (Faculty of Law and Management, University of Mauritius, Reduit, Republic of Mauritius)

  • Ramesh Durbarry

    (School of Sustainable Development and Tourism, University of Technology, Mauritius, La Tour Koenig, Pointe-aux-Sables, Republic of Mauritius)

  • J.F. Nicolas Ragodoo

    (Faculty of Social Studies and Humanities, University of Mauritius, Reduit, Republic of Mauritius)

Abstract

Estimating tourism demand has become a challenge among researchers, as identification of key determinants is important for policymakers at a time when tourism has become the world's largest industry. Using a theoretical framework based on the gravity model, this paper models inbound tourism demand for South Africa to estimate price and income sensitivities as well as the impact of other important factors that affect tourist flows, such as the location of markets and socio-political factors. Given the non-stationary but cointegrated nature of the panel data, panel cointegration estimation techniques are employed. The results show that tourists are sensitive to price changes in South Africa and also to tourism price changes in competing destinations. The level of development, tourism infrastructure, distance (or transportation costs), common border and language are also found to affect arrivals. The results also indicate the need to conduct estimation by regional groupings for a better understanding of different markets.

Suggested Citation

  • Boopen Seetanah & Ramesh Durbarry & J.F. Nicolas Ragodoo, 2010. "Using the Panel Cointegration Approach to Analyse the Determinants of Tourism Demand in South Africa," Tourism Economics, , vol. 16(3), pages 715-729, September.
    • Handle: RePEc:sae:toueco:v:16:y:2010:i:3:p:715-729
    DOI: 10.5367/000000010792278437
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    References listed on IDEAS

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    Cited by:

    1. Peter Fuleky & Carl S. Bonham & Qianxue Zhao, 2013. "Estimating Demand Elasticities in Non-Stationary Panels: The Case of Hawaii's Tourism Industry," Working Papers 201314, University of Hawaii at Manoa, Department of Economics.
    2. Sylvain Petit & Neelu Seetaram, 2018. "Measuring the Effect of Revealed Cultural Preferences on Tourism Exports," Post-Print hal-02133249, HAL.
    3. Ogechi Adeola & Olaniyi Evans, 2020. "ICT, infrastructure, and tourism development in Africa," Tourism Economics, , vol. 26(1), pages 97-114, February.
    4. Jitendra Sharma & Subrata Kumar Mitra, 2021. "Asymmetric relationship between tourist arrivals and employment," Tourism Economics, , vol. 27(5), pages 952-970, August.
    5. repec:hae:wpaper:2013-2 is not listed on IDEAS
    6. Armand Viljoen & Andrea Saayman & Melville Saayman, 2019. "Determinants influencing inbound arrivals to Africa," Tourism Economics, , vol. 25(6), pages 856-883, September.
    7. Muhammad Amin Hasan & Mr. Abdullah & Muhammad Arsalan Hashmi & Ali Sajid, 2022. "International Remittances and International Tourism Development in South Asia: The Moderating Role of Political Stability," Journal of Economic Impact, Science Impact Publishers, vol. 4(3), pages 177-187.
    8. Manuel González-Gómez, 2022. "European outbound tourism expansion on the islands of Cape Verde," Tourism Economics, , vol. 28(4), pages 1129-1150, June.
    9. Nicolau, Juan Luis, 2011. "El efecto de la participación en actividades de ocio sobre la influencia de la distancia en la elección de destinos/When the Enrollment in Recreational Activities Changes Distance Sensitivity to Desti," Estudios de Economia Aplicada, Estudios de Economia Aplicada, vol. 29, pages 803-824, Diciembre.
    10. Georges Harb & Charbel Bassil, 2020. "Terrorism and inbound tourism: Does immigration have a moderating effect?," Tourism Economics, , vol. 26(3), pages 500-518, May.
    11. Omkar Joshi & Neelam C. Poudyal & Lincoln R. Larson, 2017. "The influence of sociopolitical, natural, and cultural factors on international tourism growth: a cross-country panel analysis," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 19(3), pages 825-838, June.
    12. Wamboye, Evelyn F. & Nyaronga, Peter John & Sergi, Bruno S., 2020. "What are the determinant of international tourism in Tanzania?," World Development Perspectives, Elsevier, vol. 17(C).
    13. Recep Ulucak & Ali Gökhan Yücel & Salih Çağrı İlkay, 2020. "Dynamics of tourism demand in Turkey: Panel data analysis using gravity model," Tourism Economics, , vol. 26(8), pages 1394-1414, December.
    14. Hassani, Hossein & Webster, Allan & Silva, Emmanuel Sirimal & Heravi, Saeed, 2015. "Forecasting U.S. Tourist arrivals using optimal Singular Spectrum Analysis," Tourism Management, Elsevier, vol. 46(C), pages 322-335.
    15. Tarik Dogru & Umit Bulut & Ercan Sirakaya-Turk, 2021. "Modeling tourism demand: Theoretical and empirical considerations for future research," Tourism Economics, , vol. 27(4), pages 874-889, June.
    16. Jaume Rosselló Nadal & María Santana Gallego, 2022. "Gravity models for tourism demand modeling: Empirical review and outlook," Journal of Economic Surveys, Wiley Blackwell, vol. 36(5), pages 1358-1409, December.
    17. Muhammad Asif Khan & József Popp & Mirza Nouman Ali Talib & Zoltán Lakner & Muhammad Atif Khan & Judit Oláh, 2020. "Asymmetric Impact of Institutional Quality on Tourism Inflows Among Selected Asian Pacific Countries," Sustainability, MDPI, vol. 12(3), pages 1-16, February.
    18. Charbel Bassil & Ghialy Yap, 2024. "Can immigration moderate the adverse effects of political instability on international tourism? A case study of Australia," Tourism Economics, , vol. 30(2), pages 477-497, March.

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