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Can Seasonal Unit Root Testing Improve the Forecasting Accuracy of Tourist Arrivals?

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  • Dillon Alleyne

    (Department of Economics, University of the West Indies, Mona, Kingston, Jamaica)

Abstract

Tourism has emerged as one of the main industries in many Caribbean countries. Jamaica is no exception: tourist receipts are its largest source of foreign exchange earnings. Because of the importance of the tourism sector to the Jamaican economy, accurate forecasts of tourist arrivals are critical. This paper argues that forecasting accuracy can be improved by the use of seasonal unit root testing. Using six tourist arrival series, from 1968:1 to 2001:3, it was found that unit root testing, applying the HEGY procedure, did help to improve the forecasts at all horizons. The exceptions were those series that exhibited considerable volatility; in these cases the seasonal unit root test did not prove superior at the short horizon. These results, however, may not be robust with respect to data at other frequencies.

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  • Dillon Alleyne, 2006. "Can Seasonal Unit Root Testing Improve the Forecasting Accuracy of Tourist Arrivals?," Tourism Economics, , vol. 12(1), pages 45-64, March.
    • Handle: RePEc:sae:toueco:v:12:y:2006:i:1:p:45-64
    DOI: 10.5367/000000006776387132
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    2. Hadavandi, Esmaeil & Ghanbari, Arash & Shahanaghi, Kamran & Abbasian-Naghneh, Salman, 2011. "Tourist arrival forecasting by evolutionary fuzzy systems," Tourism Management, Elsevier, vol. 32(5), pages 1196-1203.
    3. José María Martín Martín & José Antonio Rodriguez Martín & Karla Aída Zermeño Mejía & José Antonio Salinas Fernández, 2018. "Effects of Vacation Rental Websites on the Concentration of Tourists—Potential Environmental Impacts. An Application to the Balearic Islands in Spain," IJERPH, MDPI, vol. 15(2), pages 1-14, February.
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    6. Shujie Shen & Gang Li & Haiyan Song, 2009. "Effect of Seasonality Treatment on the Forecasting Performance of Tourism Demand Models," Tourism Economics, , vol. 15(4), pages 693-708, December.
    7. José María Martín Martín & Jose Antonio Salinas Fernández & José Antonio Rodríguez Martín & Juan De Dios Jiménez Aguilera, 2017. "Assessment of the Tourism’s Potential as a Sustainable Development Instrument in Terms of Annual Stability: Application to Spanish Rural Destinations in Process of Consolidation," Sustainability, MDPI, vol. 9(10), pages 1-20, September.
    8. Marcos à lvarez-Díaz & Manuel González-Gómez & María Soledad Otero-Giráldez, 2019. "Estimating the economic impact of a political conflict on tourism: The case of the Catalan separatist challenge," Tourism Economics, , vol. 25(1), pages 34-50, February.
    9. Serena Volo, 2010. "Research Note: Seasonality in Sicilian Tourism Demand – An Exploratory Study," Tourism Economics, , vol. 16(4), pages 1073-1080, December.
    10. Stefano De Cantis & Mauro Ferrante & Franco Vaccina, 2011. "Seasonal Pattern and Amplitude – a Logical Framework to Analyse Seasonality in Tourism: An Application to Bed Occupancy in Sicilian Hotels," Tourism Economics, , vol. 17(3), pages 655-675, June.
    11. Marcos Álvarez-Díaz & Manuel González-Gómez & María Soledad Otero-Giráldez, 2018. "Forecasting International Tourism Demand Using a Non-Linear Autoregressive Neural Network and Genetic Programming," Forecasting, MDPI, vol. 1(1), pages 1-17, September.
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