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Tourism Employment and Economic Growth: Dynamic Panel Threshold Analysis

Author

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  • Darko B. Vuković

    (International Laboratory for Finance and Financial Markets, Faculty of Economics, People’s Friendship University of Russia (RUDN University), 117198 Moscow, Russia
    Geographical Institute “Jovan Cvijić”, Serbian Academy of Sciences and Arts, 11000 Belgrade, Serbia)

  • Moinak Maiti

    (Independent Researcher, Kolkata 711112, India)

  • Marko D. Petrović

    (Geographical Institute “Jovan Cvijić”, Serbian Academy of Sciences and Arts, 11000 Belgrade, Serbia
    Institute of Sports, Tourism and Service, South Ural State University, 454080 Chelyabinsk, Russia)

Abstract

The manuscript reports on findings on the interconnection between tourism employment and economic growth for the selected OECD member states. The dynamic panel threshold regression method was used to analyze the data, where the threshold variable was tourism employment, and the growth of gross national income and value added by activity services were dependent variables in the corresponding models. The dataset covered the period between 2008 and 2020. Both marginal effects indicated positive implications of tourism employment on economic growth. A percent rise in tourism employment leads to an increase in gross national income by 0.15% (in the low regime) and 0.61% (in the high regime). Yet, the results revealed a negative marginal effect of tourism employment on value added by activity services. The outcomes explain that a percent rise in tourism employment in the average country will lead to a decrease in the value added by activity services, as a percentage of value added, by 0.07% (low regime) and 0.09% (high regime). Therefore, the applications of this study are twofold—the first one is its contribution to existing theoretical knowledge through the filling of the literature gaps, and the second one is related to advances in the standing policies. The main limitations and the proposal for future research are the application of random effects and smooth transition threshold models as an alternative to the indicator functions.

Suggested Citation

  • Darko B. Vuković & Moinak Maiti & Marko D. Petrović, 2023. "Tourism Employment and Economic Growth: Dynamic Panel Threshold Analysis," Mathematics, MDPI, vol. 11(5), pages 1-14, February.
    • Handle: RePEc:gam:jmathe:v:11:y:2023:i:5:p:1112-:d:1077722
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    References listed on IDEAS

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    1. Chenghao Zhong & Wengao Lou & Yongzeng Lai, 2023. "A Projection Pursuit Dynamic Cluster Model for Tourism Safety Early Warning and Its Implications for Sustainable Tourism," Mathematics, MDPI, vol. 11(24), pages 1-17, December.

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