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Travel to Canada: the role of Canada's immigrant populations

  • David Prescott
  • David Wilton
  • Canan Dadayli
  • Aaron Dickson

The effect of Canada's immigrant populations on the annual flow of visitors to Canada is investigated. A simple utility-maximizing model of the travel decision motivates the role of immigrant populations in the aggregate demand equation for visits to Canada. The model implies testable hypotheses: price and income elasticities differ by purpose of trip. Using time-series cross-section data on 22 OECD countries an empirical demand model is estimated. Demand is measured by both the number of visitors and person-nights and separate equations are estimated for four subcategories of 'purpose of trip'. Immigrant populations are found to have a strong influence on the annual flow of foreign visitors. It is estimated that the present value of the stream of spending by foreign visitors attributable to an additional immigrant is approximately $4550 in 1996 dollars. In accordance with the model's predictions, price and income elasticity estimates are greater for vacationers than for those visiting family and friends.

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Article provided by Taylor & Francis Journals in its journal Applied Economics.

Volume (Year): 37 (2005)
Issue (Month): 6 ()
Pages: 651-663

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Handle: RePEc:taf:applec:v:37:y:2005:i:6:p:651-663
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  1. Keith Head & John Ries, 1998. "Immigration and Trade Creation: Econometric Evidence from Canada," Canadian Journal of Economics, Canadian Economics Association, vol. 31(1), pages 47-62, February.
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