Tourism, environmental quality and economic growth: empirical evidence and policy implications
AbstractThe causal relationship between tourist demand and supply is investigated employing four time series models - the first model includes nights of stay and number of supplied accommodation; the second model uses nights of stay and supplied beds (i.e. capacity); the third model employs nights of stay and the quality of supplied accommodation; finally, the fourth model includes nights of stay and the quality of supplied capacity. To test for Granger causality in the presence of a cointegration relationship between the economic variables of interest, a bivariate VAR model is used. Empirical results are from four distinctive models for Sardinia (Italy) over the time span 1955 to 2004. The first model suggests a unidirectional causal relationship running from demand to accommodation firms; the second model suggests a bi-directional causal relationship between demand and capacity. The third and fourth models indicate the existence of a unidirectional causal relationship running from quality to demand. This empirical finding implies that the environmental conservation policy (Piano Paesaggistico Regionale), adopted by the Region of Sardinia, may be feasible without compromising the number of tourists visiting Sardinia and hence, its economic growth.
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Bibliographic InfoPaper provided by Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia in its series Working Paper CRENoS with number 200609.
Date of creation: 2006
Date of revision:
tourist demand; supply; quality; growth; granger causality;
Find related papers by JEL classification:
- C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
- C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation
- O18 - Economic Development, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
- O21 - Economic Development, Technological Change, and Growth - - Development Planning and Policy - - - Planning Models; Planning Policy
This paper has been announced in the following NEP Reports:
- NEP-ALL-2006-10-28 (All new papers)
- NEP-ENV-2006-10-28 (Environmental Economics)
- NEP-TUR-2006-10-28 (Tourism Economics)
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