IDEAS home Printed from https://ideas.repec.org/a/eee/ecmode/v35y2013icp185-191.html
   My bibliography  Save this article

Tourism–growth nexus in Pakistan: Evidence from ARDL bounds tests

Author

Listed:
  • Jalil, Abdul
  • Mahmood, Tahir
  • Idrees, Muhammad

Abstract

This study is an attempt to test the long run relationship between international tourism and economic growth of Pakistan by using Autoregressive Distributed Lag (ARDL) models over the period of 1972 to 2011. The initial results show that the causality runs from tourism to economic growth. Furthermore, the estimated growth regression clearly indicates that the international tourism has a significantly positive impact on the economic growth of Pakistan along with other variables like physical capital and international trade. This implies that the improvement in the tourism sector may enhance the economic growth activities in Pakistan.

Suggested Citation

  • Jalil, Abdul & Mahmood, Tahir & Idrees, Muhammad, 2013. "Tourism–growth nexus in Pakistan: Evidence from ARDL bounds tests," Economic Modelling, Elsevier, vol. 35(C), pages 185-191.
  • Handle: RePEc:eee:ecmode:v:35:y:2013:i:c:p:185-191
    DOI: 10.1016/j.econmod.2013.06.034
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0264999313002526
    Download Restriction: Full text for ScienceDirect subscribers only

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. James B. Ang, 2010. "Does Foreign Aid Promote Growth? Exploring the Role of Financial Liberalization," Review of Development Economics, Wiley Blackwell, vol. 14(2), pages 197-212, May.
    2. Grossman, Gene M & Helpman, Elhanan, 1991. "Endogenous Product Cycles," Economic Journal, Royal Economic Society, vol. 101(408), pages 1214-1229, September.
    3. Shahbaz, Muhammad, 2012. "Does trade openness affect long run growth? Cointegration, causality and forecast error variance decomposition tests for Pakistan," Economic Modelling, Elsevier, vol. 29(6), pages 2325-2339.
    4. Engle, Robert & Granger, Clive, 2015. "Co-integration and error correction: Representation, estimation, and testing," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 39(3), pages 106-135.
    5. Grossman, Gene M & Helpman, Elhanan, 1991. "Endogenous Product Cycles," Economic Journal, Royal Economic Society, vol. 101(408), pages 1214-1229, September.
    6. John Y. Campbell & Pierre Perron, 1991. "Pitfalls and Opportunities: What Macroeconomists Should Know About Unit Roots," NBER Chapters,in: NBER Macroeconomics Annual 1991, Volume 6, pages 141-220 National Bureau of Economic Research, Inc.
    7. M. Hashem Pesaran & Yongcheol Shin & Richard J. Smith, 2001. "Bounds testing approaches to the analysis of level relationships," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 16(3), pages 289-326.
    8. Alwyn Young, 1991. "Learning by Doing and the Dynamic Effects of International Trade," The Quarterly Journal of Economics, Oxford University Press, vol. 106(2), pages 369-405.
    9. Edwards, Sebastian, 1998. "Openness, Productivity and Growth: What Do We Really Know?," Economic Journal, Royal Economic Society, vol. 108(447), pages 383-398, March.
    10. Khan, Safdar Ullah Khan, 2005. "Macro Determinants of Total Factor Productivity in Pakistan," MPRA Paper 8693, University Library of Munich, Germany, revised 10 Sep 2005.
    11. Jong-Wha Lee, 1993. "International Trade, Distortions, and Long-Run Economic Growth," IMF Staff Papers, Palgrave Macmillan, vol. 40(2), pages 299-328, June.
    12. João R. Faria & Francisco Galrão Carneiro, 2001. "Does High Inflation Affect Growth in the Long and Short Run?," Journal of Applied Economics, Universidad del CEMA, vol. 4, pages 89-105, May.
    13. Po, Wan-Chen & Huang, Bwo-Nung, 2008. "Tourism development and economic growth–a nonlinear approach," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 387(22), pages 5535-5542.
    14. Johansen, Soren, 1991. "Estimation and Hypothesis Testing of Cointegration Vectors in Gaussian Vector Autoregressive Models," Econometrica, Econometric Society, vol. 59(6), pages 1551-1580, November.
    15. repec:ebl:ecbull:v:3:y:2008:i:21:p:1-8 is not listed on IDEAS
    16. N. Gregory Mankiw & David Romer & David N. Weil, 1992. "A Contribution to the Empirics of Economic Growth," The Quarterly Journal of Economics, Oxford University Press, vol. 107(2), pages 407-437.
    17. Nehru, Vikram & Swanson, Eric & Dubey, Ashutosh, 1993. "A new database on human capital stock : sources, methodology and results," Policy Research Working Paper Series 1124, The World Bank.
    18. Aviral Kumar Tiwari, 2011. "Tourism, Exports and FDI as a Means of Growth: Evidence from four Asian Countries," Romanian Economic Journal, Department of International Business and Economics from the Academy of Economic Studies Bucharest, vol. 14(40), pages 131-151, June.
    19. Jacint Balaguer & Manuel Cantavella-Jorda, 2002. "Tourism as a long-run economic growth factor: the Spanish case," Applied Economics, Taylor & Francis Journals, vol. 34(7), pages 877-884.
    20. Krueger, Anne O, 1980. "Trade Policy as an Input to Development," American Economic Review, American Economic Association, vol. 70(2), pages 288-292, May.
    21. Rivera-Batiz, Luis A. & Xie, Danyang, 1993. "Integration among unequals," Regional Science and Urban Economics, Elsevier, vol. 23(3), pages 337-354, July.
    22. 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.
    23. Alwyn Young, 1991. "Learning by Doing and the Dynamic Effects of International Trade," NBER Working Papers 3577, National Bureau of Economic Research, Inc.
    24. George A. Akerlof & William R. Dickens & George L. Perry, 1996. "The Macroeconomics of Low Inflation," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 27(1), pages 1-76.
    25. Salih Katircioglu, 2009. "Tourism, trade and growth: the case of Cyprus," Applied Economics, Taylor & Francis Journals, vol. 41(21), pages 2741-2750.
    26. Tiago Neves Sequeira & Paulo Macas Nunes, 2008. "Does tourism influence economic growth? A dynamic panel data approach," Applied Economics, Taylor & Francis Journals, vol. 40(18), pages 2431-2441.
    27. Michael Sarel, 1996. "Nonlinear Effects of Inflation on Economic Growth," IMF Staff Papers, Palgrave Macmillan, vol. 43(1), pages 199-215, March.
    28. Harrison, Ann, 1996. "Openness and growth: A time-series, cross-country analysis for developing countries," Journal of Development Economics, Elsevier, vol. 48(2), pages 419-447, March.
    29. Venus Khim-Sen Liew, 2004. "Nonlinear Adjustment of ASEAN-5 Real Exchange Rates: Symmetrical or Asymmetrical?," Economics Bulletin, AccessEcon, vol. 6(8), pages 1-19.
    30. Abdul Jalil & Mete Feridun, 2011. "Impact of financial development on economic growth: empirical evidence from Pakistan," Journal of the Asia Pacific Economy, Taylor & Francis Journals, vol. 16(1), pages 71-80.
    31. Beck, Thorsten, 2002. "Financial development and international trade: Is there a link?," Journal of International Economics, Elsevier, vol. 57(1), pages 107-131, June.
    32. By Mohsin S. Khan & Abdelhak S. Senhadji, 2001. "Threshold Effects in the Relationship Between Inflation and Growth," IMF Staff Papers, Palgrave Macmillan, vol. 48(1), pages 1-1.
    33. 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.
    34. Lucas, Robert Jr., 1988. "On the mechanics of economic development," Journal of Monetary Economics, Elsevier, vol. 22(1), pages 3-42, July.
    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. Hasnul, Al Gifari & Masih, Mansur, 2016. "Role of instability in affecting capital flight magnitude: An ARDL bounds testing approach," MPRA Paper 72086, University Library of Munich, Germany.
    2. Agiomirgianakis, George & Serenis, Dimitrios & Tsounis, Nicholas, 2017. "Effective timing of tourism policy: The case of Singapore," Economic Modelling, Elsevier, vol. 60(C), pages 29-38.
    3. Muhammad Ahad, 2016. "Does Tourism-led Growth Hypothesis exist in Pakistan? A Freshlook from Combine Cointegration and Causality Approach with Structural Breaks," International Journal of Economics and Empirical Research (IJEER), The Economics and Social Development Organization (TESDO), vol. 4(2), pages 94-111, February.
    4. Shahbaz, Muhammad & Ferrer, Román & Hussain Shahzad, Syed Jawad & Haouas, Ilham, 2017. "Is the tourism-economic growth nexus time-varying? Bootstrap rolling-window causality analysis for the top ten tourist destinations," MPRA Paper 82713, University Library of Munich, Germany, revised 04 Nov 2017.
    5. Murthy, Vasudeva N.R. & Okunade, Albert A., 2016. "Determinants of U.S. health expenditure: Evidence from autoregressive distributed lag (ARDL) approach to cointegration," Economic Modelling, Elsevier, vol. 59(C), pages 67-73.
    6. repec:eee:touman:v:46:y:2015:i:c:p:158-163 is not listed on IDEAS
    7. Tang, Chor Foon & Aviral Kumar, Tiwari & Shahbaz, Muhammad, 2016. "Dynamic Inter-relationships among tourism, economic growth and energy consumption in India," MPRA Paper 69848, University Library of Munich, Germany, revised 04 Mar 2016.
    8. Tomohara, Akinori, 2016. "Japan's tourism-led foreign direct investment inflows: An empirical study," Economic Modelling, Elsevier, vol. 52(PB), pages 435-441.

    More about this item

    Keywords

    Tourism; Economic growth; ARDL bounds tests; Pakistan;

    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; State Space Models
    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development

    Statistics

    Access and download statistics

    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:eee:ecmode:v:35:y:2013:i:c:p:185-191. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dana Niculescu). General contact details of provider: http://www.elsevier.com/locate/inca/30411 .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.