Asian Financial Crisis, Avian Flu And Terrorist Threats: Are Shocks To Malaysian Tourist Arrivals Permanent Or Transitory?
AbstractInternational visitor arrivals from Malaysia's ten major source markets are examined using Lagrange Multiplier (LM) unit root tests with one and two structural breaks to ascertain if shocks to the time path of tourist arrivals are permanent or transitory. The LM unit root test with one break is able to reject the unit root null for between 60 per cent of source markets where the break is specified as in the intercept and 90 per cent of source markets where the break is specified as in the intercept and slope. The LM unit root test with two breaks is able to reject the unit root null for all source markets, irrespective of how the break is specified. This result suggests that the effects of shocks on the growth path of tourist arrivals to Malaysia from its major markets are only transitory and that Malaysia's tourist sector is sustainable in the long run. While the effects of shocks are not permanent we do find that following shocks the growth in tourist arrivals from Malaysia's source markets have generally slowed. This result suggests there is a need to reduce the negative effects of slower growth in the recovery phase.
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Bibliographic InfoPaper provided by Monash University, Department of Economics in its series Monash Economics Working Papers with number 11/06.
Length: 26 pages
Date of creation: 02 Jun 2006
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Postal: Department of Economics, Monash University, Victoria 3800, Australia
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This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-07-17 (All new papers)
- NEP-SEA-2009-07-17 (South East Asia)
- NEP-TUR-2009-07-17 (Tourism Economics)
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