IDEAS home Printed from https://ideas.repec.org/a/sae/toueco/v19y2013i6p1317-1344.html
   My bibliography  Save this article

Tourism and Economic Growth in Australia: An Empirical Investigation of Causal Links

Author

Listed:
  • Kristen Corrie

    (At time of writing: James Cook University, Townsville, Australia)

  • Natalie Stoeckl

    (School of Business, James Cook University, Townsville 4811, Australia)

  • Taha Chaiechi

    (School of Business, James Cook University, Cairns, Australia)

Abstract

This paper seeks to determine whether tourism has promoted economic growth in Australia during the last two decades. Specifically, it uses Granger Causality analysis to explore the relationship between (i) tourism expenditure and gross domestic product and (ii) tourism expenditure and expenditure on other factors known to be associated with tourism demand. According to the results, there is a bi-causal link between tourism and economic growth, indicating the possible existence of tourism-led endogenous growth. The results also suggest that food expenditure (specifically expenditure in restaurants, cafés and takeaways) may be the key to growth in the tourism sector. Evidently, expenditure in this sector may facilitate the growth of other industries through the local market, thus kick-starting a system of endogenous growth via tourism.

Suggested Citation

  • Kristen Corrie & Natalie Stoeckl & Taha Chaiechi, 2013. "Tourism and Economic Growth in Australia: An Empirical Investigation of Causal Links," Tourism Economics, , vol. 19(6), pages 1317-1344, December.
    • Handle: RePEc:sae:toueco:v:19:y:2013:i:6:p:1317-1344
    DOI: 10.5367/te.2013.0241
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.5367/te.2013.0241
    Download Restriction: no
    File URL: https://libkey.io/10.5367/te.2013.0241?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Granger, C. W. J., 1988. "Causality, cointegration, and control," Journal of Economic Dynamics and Control, Elsevier, vol. 12(2-3), pages 551-559.
    2. Venus Khim-Sen Liew, 2004. "Which Lag Length Selection Criteria Should We Employ?," Economics Bulletin, AccessEcon, vol. 3(33), pages 1-9.
    3. Holzner, Mario, 2011. "Tourism and economic development: The beach disease?," Tourism Management, Elsevier, vol. 32(4), pages 922-933.
    4. Brida, Juan Gabriel & Pereyra, Juan S. & Risso, Wiston Adrián & Devesa, María Jesús Such & Aguirre, Sandra Zapata, 2008. "The Tourism-led Growth Hypothesis: Empirical Evidence from Colombia," MPRA Paper 25286, University Library of Munich, Germany, revised 19 Mar 2009.
    5. Johansen, Soren & Juselius, Katarina, 1990. "Maximum Likelihood Estimation and Inference on Cointegration--With Applications to the Demand for Money," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 52(2), pages 169-210, May.
    6. Hassapis, Christis & Pittis, Nikitas & Prodromidis, Kyprianos, 1999. "Unit roots and Granger causality in the EMS interest rates: the German Dominance Hypothesis revisited," Journal of International Money and Finance, Elsevier, vol. 18(1), pages 47-73, January.
    7. David Fielding & Anja Shortland, 2009. "Does television terrify tourists? Effects of US television news on demand for tourism in Israel," Journal of Risk and Uncertainty, Springer, vol. 38(3), pages 245-263, June.
    8. Joo Hwan Seo & Sung Yong Park & Soyoung Boo, 2010. "Interrelationships among Korean Outbound Tourism Demand: Granger Causality Analysis," Tourism Economics, , vol. 16(3), pages 597-610, September.
    9. Gunderson, Ronald J. & Ng, Pin T., 2005. "Analyzing the Effects of Amenities, Quality of Life Attributes and Tourism on Regional Economic Performance using Regression Quantiles," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 35(1), pages 1-22.
    10. Robertico Croes & Manuel Antonio Rivera, 2010. "Testing the Empirical Link between Tourism and Competitiveness: Evidence from Puerto Rico," Tourism Economics, , vol. 16(1), pages 217-234, March.
    11. Ajayi, Richard A. & Friedman, Joseph & Mehdian, Seyed M., 1998. "On the relationship between stock returns and exchange rates: Tests of granger causality," Global Finance Journal, Elsevier, vol. 9(2), pages 241-251.
    12. Hatice Pehlivan Jenkıns & Salih Turan Katırcıoglu, 2010. "The bounds test approach for cointegration and causality between financial development, international trade and economic growth: the case of Cyprus," Applied Economics, Taylor & Francis Journals, vol. 42(13), pages 1699-1707.
    13. Arslanturk, Yalcin & Balcilar, Mehmet & Ozdemir, Zeynel Abidin, 2011. "Time-varying linkages between tourism receipts and economic growth in a small open economy," Economic Modelling, Elsevier, vol. 28(1), pages 664-671.
    14. Jordan Shan & Ken Wilson, 2001. "Causality between trade and tourism: empirical evidence from China," Applied Economics Letters, Taylor & Francis Journals, vol. 8(4), pages 279-283.
    15. George, Richard, 2010. "Visitor perceptions of crime-safety and attitudes towards risk: The case of Table Mountain National Park, Cape Town," Tourism Management, Elsevier, vol. 31(6), pages 806-815.
    16. 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.
    17. Charalambos Louca, 2006. "Income and Expenditure in the Tourism Industry: Time Series Evidence from Cyprus," Tourism Economics, , vol. 12(4), pages 603-617, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Qin Yang & Huan Dan & Tingting Ni & Pan Zhao & Junyi Wei & Gang Wang, 2023. "Research on the Coupling and Coordinated Development of the Tourism Industry and Regional Economy in the Economic Circle of the Sichuan–Chongqing Region in Southwest China," Sustainability, MDPI, vol. 15(3), pages 1-19, January.
    2. Naradda Gamage, Sisira Kumara & Kumudumali, S. H. T. & Otamurodov, Shavkat, 2020. "The Nexus between Tourism and Economic Growth: A Systematic Literature Review and Future Research Directions," MPRA Paper 104086, University Library of Munich, Germany.
    3. Avishek Khanal & Mohammad Mafizur Rahman & Rasheda Khanam & Eswaran Velayutham, 2022. "Exploring the Impact of Air Transport on Economic Growth: New Evidence from Australia," Sustainability, MDPI, vol. 14(18), pages 1-17, September.
    4. Uktam Umurzakov & Shakhnoza Tosheva & Raufhon Salahodjaev, 2023. "Tourism and Sustainable Economic Development: Evidence from Belt and Road Countries," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 14(1), pages 503-516, March.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. 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 of th," MPRA Paper 37332, University Library of Munich, Germany, revised 2011.
    2. Andreas G. Georgantopoulos, 2013. "Tourism Expansion and Economic Development: Var/Vecm Analysis and Forecasts for the Case of India," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 3(4), pages 464-482, April.
    3. Muhammad Shahbaz & Ronald Ravinesh Kumar & Stanislav Ivanov & Nanthakumar Loganathan, 2017. "The nexus between tourism demand and output per capita with the relative importance of trade openness and financial development," Tourism Economics, , vol. 23(1), pages 168-186, February.
    4. Abdul Rehman & Hengyun Ma & Muhammad Irfan & Munir Ahmad & Ousmane Traore, 2020. "Investigating the Influence of International Tourism in Pakistan and Its Linkage to Economic Growth: Evidence From ARDL Approach," SAGE Open, , vol. 10(2), pages 21582440209, June.
    5. Bruno Eeckels & George Filis & Costas Leon, 2012. "Tourism Income and Economic Growth in Greece: Empirical Evidence from Their Cyclical Components," Tourism Economics, , vol. 18(4), pages 817-834, August.
    6. Juan Gabriel Brida & Lionello F. Punzo & Wiston Adrián Risso, 2011. "Research Note: Tourism as a Factor of Growth – the Case of Brazil," Tourism Economics, , vol. 17(6), pages 1375-1386, December.
    7. Chor Foon Tang & Salah Abosedra, 2016. "Tourism and growth in Lebanon: new evidence from bootstrap simulation and rolling causality approaches," Empirical Economics, Springer, vol. 50(2), pages 679-696, March.
    8. repec:ebl:ecbull:v:3:y:2008:i:21:p:1-8 is not listed on IDEAS
    9. Shahbaz, Muhammad & Kumar, Ronald Ravinesh & Ivanov, Stanislav & Loganathan, Nanthakumar, 2015. "Nexus between Tourism demand and output per capita with relative importance of trade and financial development: A study of Malaysia," MPRA Paper 67226, University Library of Munich, Germany, revised 11 Oct 2015.
    10. Edgar J Sanchez Carrera & W. Adrian Risso & Juan Gabriel Brida, 2008. "Tourism's Impact on Long-Run Mexican Economic Growth," Economics Bulletin, AccessEcon, vol. 3(21), pages 1-8.
    11. Schubert, Stefan Franz & Brida, Juan Gabriel, 2009. "A Dynamic Model of Economic Growth in a Small Tourism Driven Economy," MPRA Paper 16737, University Library of Munich, Germany.
    12. Jorge Ridderstaat & Robertico Croes & Peter Nijkamp, 2013. "Modelling Tourism Development and Long-run Economic Growth in Aruba," Tinbergen Institute Discussion Papers 13-145/VIII, Tinbergen Institute.
    13. Muhammad Shahbaz & Ramzi Benkraiem & Anthony Miloudi & Aviral Kumar Tiwari, 2019. "Tourism-induced financial development in Malaysia: New evidence from the tourism development index," Tourism Economics, , vol. 25(5), pages 757-778, August.
    14. 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.
    15. Stanislav H. Ivanov & Craig Webster, 2013. "Tourism's Contribution to Economic Growth: A Global Analysis for the First Decade of the Millennium," Tourism Economics, , vol. 19(3), pages 477-508, June.
    16. E. M. Ekanayake & Aubrey E. Long, 2012. "Tourism Development And Economic Growth In Developing Countries," The International Journal of Business and Finance Research, The Institute for Business and Finance Research, vol. 6(1), pages 51-63.
    17. 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.
    18. José Antonio Camuñez & Maria P Pablo-Romero & Javier Sánchez-Rivas, 2018. "Tourism capital," Tourism Economics, , vol. 24(7), pages 889-900, November.
    19. Sadyrbek Kozhokulov & Xi Chen & Degang Yang & Gulnura Issanova & Kanat Samarkhanov & Selvina Aliyeva, 2019. "Assessment of Tourism Impact on the Socio-Economic Spheres of the Issyk-Kul Region (Kyrgyzstan)," Sustainability, MDPI, vol. 11(14), pages 1-18, July.
    20. Ronald Ravinesh Kumar & Peter Josef Stauvermann & Nikeel Kumar & Syed Jawad Hussain Shahzad, 2019. "Exploring the effect of ICT and tourism on economic growth: a study of Israel," Economic Change and Restructuring, Springer, vol. 52(3), pages 221-254, August.
    21. Salahodjaev, Raufhon & Safarova, Nilufar, 2015. "Do foreign visitors reward post-communist countries? A panel evidence for tourism-growth nexus," MPRA Paper 66215, University Library of Munich, Germany.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:toueco:v:19:y:2013:i:6:p:1317-1344. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.