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Do geopolitical risks matter for inbound tourism?

Author

Listed:
  • Ender Demir

    (Istanbul Medeniyet University)

  • Giray Gozgor

    (Istanbul Medeniyet University)

  • Sudharshan Reddy Paramati

    (University of Dundee)

Abstract

This paper aims to analyze the impact of geopolitical risks measured by a new index of geopolitical risk (GPR) on inbound tourism. For this purpose, we use the fixed-effects and the least squares dummy variable corrected estimations for panel data of 18 countries for the period from 1995 to 2016. We find that geopolitical risks negatively affect inbound tourism. We also implement various robustness checks, such as introducing control variables, considering the lagged effect of the GPR, and utilizing different econometric techniques.

Suggested Citation

  • Ender Demir & Giray Gozgor & Sudharshan Reddy Paramati, 2019. "Do geopolitical risks matter for inbound tourism?," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 9(2), pages 183-191, June.
    • Handle: RePEc:spr:eurasi:v:9:y:2019:i:2:d:10.1007_s40821-019-00118-9
    DOI: 10.1007/s40821-019-00118-9
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    9. Rangan Gupta & Giray Gozgor & Huseyin Kaya & Ender Demir, 2019. "Effects of geopolitical risks on trade flows: evidence from the gravity model," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 9(4), pages 515-530, December.
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    Cited by:

    1. Veli YILANCI & Sertaç HOPOĞLU & Hakan ERYÜZLÜ, 2023. "The impact of the economic policy uncertainty and geopolitical risks on tourism demand of Mexico," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania - AGER, vol. 0(3(636), A), pages 147-164, Autumn.
    2. Muhammad Amin Hasan & Mr. Abdullah & Muhammad Arsalan Hashmi & Ali Sajid, 2022. "International Remittances and International Tourism Development in South Asia: The Moderating Role of Political Stability," Journal of Economic Impact, Science Impact Publishers, vol. 4(3), pages 177-187.
    3. Osama D. Sweidan, 2023. "Geopolitical Risk and Income Inequality: Evidence from the US Economy," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 169(1), pages 575-597, September.
    4. Martin Rigelský & Beata Gavurova & Ladislav Suhanyi & Radovan Bačík & Viera Ivankova, 2021. "The effect of institutional innovations on tourism spending in developed countries," Entrepreneurship and Sustainability Issues, VsI Entrepreneurship and Sustainability Center, vol. 9(2), pages 457-472, December.
    5. Sakiru Adebola Solarin & Luis A. Gil‐Alana & Maria Jesus Gonzalez‐Blanch, 2023. "Persistence and dependence in geopolitical risks in various developed and developing countries," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 28(2), pages 1488-1496, April.
    6. Herman Suzana, 2023. "Dynamic Common Correlated Effects of Geopolitical Risk on International Tourism Arrivals," Folia Oeconomica Stetinensia, Sciendo, vol. 23(2), pages 132-149, December.
    7. Raheem, Ibrahim D. & le Roux, Sara, 2023. "Geopolitical risks and tourism stocks: New evidence from causality-in-quantile approach," The Quarterly Review of Economics and Finance, Elsevier, vol. 88(C), pages 1-7.
    8. Ismet GOCER & Peter KOVACS, 2023. "The effects of geopolitical risks on tourism revenues of the Middle East and Asian countries," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania - AGER, vol. 0(1(634), S), pages 77-90, Spring.
    9. Karabulut, Gokhan & Bilgin, Mehmet Huseyin & Demir, Ender & Doker, Asli Cansin, 2020. "How pandemics affect tourism: International evidence," Annals of Tourism Research, Elsevier, vol. 84(C).
    10. Umer Shahzad & Muhammad Ramzan & Muhammad Ibrahim Shah & Buhari DoÄŸan & Ahdi Noomen Ajmi, 2022. "Analyzing the Nexus Between Geopolitical Risk, Policy Uncertainty, and Tourist Arrivals: Evidence From the United States," Evaluation Review, , vol. 46(3), pages 266-295, June.
    11. Shen, Huayu & Liang, Yue & Li, Hanwen & Liu, Jie & Lu, Guangxi, 2021. "Does geopolitical risk promote mergers and acquisitions of listed companies in energy and electric power industries," Energy Economics, Elsevier, vol. 95(C).
    12. Osama D. Sweidan, 2023. "The Effect of Geopolitical Risk on Income Inequality: Evidence from a Panel Analysis," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 167(1), pages 47-66, June.
    13. Olena STRYZHAK & Ramazan SAYAR & Yılmaz Onur ARI, 2022. "Geopolitical risks, GDP and tourism: an ARDL-ECM cointegration study on Ukraine," CES Working Papers, Centre for European Studies, Alexandru Ioan Cuza University, vol. 14(1), pages 85-113, May.
    14. Haoke Ding & Yinghua Ren & Wanhai You, 2022. "Does uncertainty granger-causes visitor arrivals? evidence from the MF-VAR model," Quality & Quantity: International Journal of Methodology, Springer, vol. 56(6), pages 4193-4215, December.
    15. Ferhat Pehlivanoğlu & Saffet Akdağ & Andrew Adewale Alola, 2021. "The causal nexus of geopolitical risks, consumer and producer confidence indexes: evidence from selected economies," Quality & Quantity: International Journal of Methodology, Springer, vol. 55(4), pages 1261-1273, August.
    16. Demir, Ender & Danisman, Gamze Ozturk, 2021. "The impact of economic uncertainty and geopolitical risks on bank credit," The North American Journal of Economics and Finance, Elsevier, vol. 57(C).

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    More about this item

    Keywords

    Geopolitical risks; Inbound tourism; Tourism demand; Developing economies; Panel data estimation techniques;
    All these keywords.

    JEL classification:

    • F50 - International Economics - - International Relations, National Security, and International Political Economy - - - General
    • Z32 - Other Special Topics - - Tourism Economics - - - Tourism and Development
    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models

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