IDEAS home Printed from https://ideas.repec.org/a/plo/pone00/0270772.html
   My bibliography  Save this article

The role of tourism in service sector employment: Do market capital, financial development and trade also play a role?

Author

Listed:
  • Avishek Khanal
  • Mohammad Mafizur Rahman
  • Rasheda Khanam
  • Eswaran Velayutham

Abstract

Workers’ living standards have recently deteriorated in the service sector throughout the world, although a few decades ago, service was among the fastest growing sectors in industrialised nations. However, in recent years, in service sectors tourism especially has been drying up. This paper examines the symmetric and asymmetric effects of tourism, market capital, financial development, and trade on service sector employment in Australia from the period 1991–2019. The results of the cointegration tests, notably the ARDL and NARDL bound tests, reveal that the variables are related in the long run. The positive effect of tourist arrival on service sector employment in Australia is confirmed by long-run estimates from both ARDL and NARDL approaches. Similarly, both approaches also confirm the long-run positive relation of financial development. However, while ARDL shows long-run negative and positive associations of market capital and trade, respectively, the opposite is found in the case of the NARDL approach. As a result, policy proposals like planning and initiating tools for ensuring consistent international arrivals and easing of entry requirements have been recommended by this study to assist Australia in enhancing service sector employment, thus promoting economic development.

Suggested Citation

  • Avishek Khanal & Mohammad Mafizur Rahman & Rasheda Khanam & Eswaran Velayutham, 2022. "The role of tourism in service sector employment: Do market capital, financial development and trade also play a role?," PLOS ONE, Public Library of Science, vol. 17(8), pages 1-18, August.
    • Handle: RePEc:plo:pone00:0270772
    DOI: 10.1371/journal.pone.0270772
    as

    Download full text from publisher

    File URL: https://journals.plos.org/plosone/article?id=10.1371/journal.pone.0270772
    Download Restriction: no
    File URL: https://journals.plos.org/plosone/article/file?id=10.1371/journal.pone.0270772&type=printable
    Download Restriction: no
    File URL: https://libkey.io/10.1371/journal.pone.0270772?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. Kizito Uyi Ehigiamusoe, 2021. "The nexus between tourism, financial development, and economic growth: Evidence from African countries," African Development Review, African Development Bank, vol. 33(2), pages 382-396, June.
    2. Jaroslava Botev & Balázs Égert & Fredj Jawadi, 2019. "The nonlinear relationship between economic growth and financial development: Evidence from developing, emerging and advanced economies," International Economics, CEPII research center, issue 160, pages 3-13.
    3. Helmut Lütkepohl & Fang Xu, 2012. "The role of the log transformation in forecasting economic variables," Empirical Economics, Springer, vol. 42(3), pages 619-638, June.
    4. Ben Jedidia, Khoutem & Boujelbène, Thouraya & Helali, Kamel, 2014. "Financial development and economic growth: New evidence from Tunisia," Journal of Policy Modeling, Elsevier, vol. 36(5), pages 883-898.
    5. Kim, Bae-Geun, 2020. "Sectoral shifts and comovements in employment," Economics Letters, Elsevier, vol. 192(C).
    6. Bartholomew K. Armah, 1994. "Impact Of Trade On Service Sector Employment: Implications For Women And Minorities," Contemporary Economic Policy, Western Economic Association International, vol. 12(1), pages 67-78, January.
    7. repec:eme:ijlma0:ijlma-06-2017-0141 is not listed on IDEAS
    8. Wolfgang Dauth & Sebastian Findeisen & Jens Suedekum, 2017. "Trade and Manufacturing Jobs in Germany," American Economic Review, American Economic Association, vol. 107(5), pages 337-342, May.
    9. Victor R. Fuchs, 1980. "Economic Growth and the Rise of Service Employment," NBER Working Papers 0486, National Bureau of Economic Research, Inc.
    10. Jack Daly & Gary Gereffi, 2017. "Tourism global value chains and Africa," WIDER Working Paper Series 017, World Institute for Development Economic Research (UNU-WIDER).
    11. Kevin O'Connor & Peter Daniels, 2001. "The Geography of International Trade in Services: Australia and the APEC Region," Environment and Planning A, , vol. 33(2), pages 281-296, February.
    12. Mr. Tamim Bayoumi & Ola Melander, 2008. "Credit Matters: Empirical Evidence on U.S. Macro-Financial Linkages," IMF Working Papers 2008/169, International Monetary Fund.
    13. Avishek Khanal, 2021. "The Role of ICT and Energy Consumption on Carbon Emissions: An Australian Evidence Using Cointegration Test and ARDL Long-run and Short-run Methodology," International Journal of Energy Economics and Policy, Econjournals, vol. 11(5), pages 441-449.
    14. Chinazaekpere Nwani, 2017. "Causal relationship between crude oil price, energy consumption and carbon dioxide (CO 2 ) emissions in Ecuador," OPEC Energy Review, Organization of the Petroleum Exporting Countries, vol. 41(3), pages 201-225, September.
    15. 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.
    16. Joseph E. Stiglitz, 2018. "From manufacturing-led export growth to a twenty-first-century inclusive growth strategy: Explaining the demise of a successful growth model and what to do about it," WIDER Working Paper Series wp-2018-176, World Institute for Development Economic Research (UNU-WIDER).
    17. Samargandi, Nahla & Kutan, Ali M., 2016. "Private credit spillovers and economic growth: Evidence from BRICS countries," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 44(C), pages 56-84.
    18. Nieuwerburgh, Stijn Van & Buelens, Frans & Cuyvers, Ludo, 2006. "Stock market development and economic growth in Belgium," Explorations in Economic History, Elsevier, vol. 43(1), pages 13-38, January.
    19. Avishek Khanal & Mohammad Mafizur Rahman & Rasheda Khanam & Eswaran Velayutham, 2021. "Are Tourism and Energy Consumption Linked? Evidence from Australia," Sustainability, MDPI, vol. 13(19), pages 1-20, September.
    20. 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.
    21. Avishek Khanal, 2021. "Does Energy Consumption Impact The Environment? Evidence from Australia Using the JJ Bayer-Hanck Cointegration Technique and the Autoregressive Distributed Lag Test," International Journal of Energy Economics and Policy, Econjournals, vol. 11(4), pages 185-194.
    22. Charles Adjasi & Nicholas Biekpe, 2006. "Stock Market Development and Economic Growth: The Case of Selected African Countries," African Development Review, African Development Bank, vol. 18(1), pages 144-161.
    23. Farid Irani & Salih Katircioglu & Korhan K. Gokmenoglu, 2021. "Effects of Business and Finance Conditions on Tourism Firms’ Financial Performances: Evidence From Major Tourist Destinations," SAGE Open, , vol. 11(3), pages 21582440211, August.
    24. Jack Daly & Gary Gereffi, 2017. "Tourism global value chains and Africa," WIDER Working Paper Series wp-2017-17, World Institute for Development Economic Research (UNU-WIDER).
    Full references (including those not matched with items on IDEAS)

    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. Avishek Khanal & Mohammad Mafizur Rahman & Rasheda Khanam & Eswaran Velayutham, 2021. "Are Tourism and Energy Consumption Linked? Evidence from Australia," Sustainability, MDPI, vol. 13(19), pages 1-20, September.
    2. Abdullahil Mamun & Mohammad Hasmat Ali & Nazamul Hoque & Md Masrurul Mowla & Shahanara Basher, 2018. "The Causality between Stock Market Development and Economic Growth: Econometric Evidence from Bangladesh," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 10(5), pages 212-220, May.
    3. Md. Qamruzzaman & Jianguo Wei, 2018. "Financial Innovation, Stock Market Development, and Economic Growth: An Application of ARDL Model," IJFS, MDPI, vol. 6(3), pages 1-30, August.
    4. Sin-Yu Ho & N.M. Odhiambo, 2018. "Analysing the macroeconomic drivers of stock market development in the Philippines," Cogent Economics & Finance, Taylor & Francis Journals, vol. 6(1), pages 1451265-145, January.
    5. Vít Pošta & Aziya Mukusheva & Nurilya Kuchukova, 2022. "Economic Performance and Financial Stability: Case of the Eurasian Economic Union," Journal of Economics / Ekonomicky casopis, Institute of Economic Research, Slovak Academy of Sciences, vol. 70(1), pages 22-35, January.
    6. Jagadish Prasad Bist & Nar Bahadur Bista, 2018. "Finance–Growth Nexus in Nepal: An Application of the ARDL Approach in the Presence of Structural Breaks," Vikalpa: The Journal for Decision Makers, , vol. 43(4), pages 236-249, December.
    7. Rabiu Maijama’a & Kabiru Saidu Musa, 2020. "Crude Oil Price, Urbanization and Environmental Pollution in Nigeria: Evidence from ARDL Approach," Asian Journal of Economic Modelling, Asian Economic and Social Society, vol. 8(4), pages 227-240, December.
    8. David Greasley & Les Oxley, 2010. "Cliometrics And Time Series Econometrics: Some Theory And Applications," Journal of Economic Surveys, Wiley Blackwell, vol. 24(5), pages 970-1042, December.
    9. Sheilla Nyasha & Nicholas M. Odhiambo, 2017. "Banks, Stock Market Development and Economic Growth in Kenya: An Empirical Investigation," Journal of African Business, Taylor & Francis Journals, vol. 18(1), pages 1-23, January.
    10. Ishmael Radikoko & Shadreck A. Mutobo & Mphoeng Mphoeng, 2019. "The Impact of Stock Market Development on Economic Growth: The Case of Botswana," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 11(12), pages 149-149, December.
    11. Polat, Ali & Shahbaz, Muhammad & Ur Rehman, Ijaz & Satti, Saqlain Latif, 2013. "Revisiting Linkages between Financial Development, Trade Openness and Economic Growth in South Africa: Fresh Evidence from Combined Cointegration Test," MPRA Paper 51724, University Library of Munich, Germany, revised 25 Nov 2013.
    12. Nyasha S. & Odhiambo N. M., 2016. "The Impact of Bank-Based and Market-Based Financial Development on Economic Growth: Time-Series Evidence From the United Kingdom," Global Economy Journal, De Gruyter, vol. 16(2), pages 389-410, June.
    13. Yuanhua Yang & Zhongwen Peng & Dengli Tang, 2024. "The impact of heterogeneous environmental regulations on carbon neutrality in China: New evidence based on the spatial measurement model," Energy & Environment, , vol. 35(3), pages 1456-1478, May.
    14. Abdullah Bin Omar & Anis Ali & Salma Mouneer & Robina Kouser & Mamdouh Abdulaziz Saleh Al-Faryan, 2022. "Is stock market development sensitive to macroeconomic indicators? A fresh evidence using ARDL bounds testing approach," PLOS ONE, Public Library of Science, vol. 17(10), pages 1-19, October.
    15. Tobechi F. Agbanike & Chinazaekpere Nwani & Uwazie I. Uwazie & Lasbrey I. Anochiwa & Thank-God C. Onoja & Ikwor O. Ogbonnaya, 2019. "Oil price, energy consumption and carbon dioxide (CO2) emissions: insight into sustainability challenges in Venezuela," Latin American Economic Review, Springer;Centro de Investigaciòn y Docencia Económica (CIDE), vol. 28(1), pages 1-26, December.
    16. Nawaz, Kishwar & Lahiani, Amine & Roubaud, David, 2019. "Natural resources as blessings and finance-growth nexus: A bootstrap ARDL approach in an emerging economy," Resources Policy, Elsevier, vol. 60(C), pages 277-287.
    17. Yugang He & Xiaodan Gao & Renhong Wu & Yinhui Wang & Baek-Ryul Choi, 2021. "How Does Sustainable Rural Tourism Cause Rural Community Development?," Sustainability, MDPI, vol. 13(24), pages 1-20, December.
    18. Ho, Sin-Yu, 2017. "The Macroeconomic Determinants of Stock Market Development: Evidence from Malaysia," MPRA Paper 77232, University Library of Munich, Germany.
    19. Enisan, Akinlo A. & Olufisayo, Akinlo O., 2009. "Stock market development and economic growth: Evidence from seven sub-Sahara African countries," Journal of Economics and Business, Elsevier, vol. 61(2), pages 162-171.
    20. Kirikkaleli, Dervis, 2020. "The effect of domestic and foreign risks on an emerging stock market: A time series analysis," The North American Journal of Economics and Finance, Elsevier, vol. 51(C).

    More about this item

    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:plo:pone00:0270772. 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: plosone (email available below). General contact details of provider: https://journals.plos.org/plosone/ .

    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.