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High skills, high growth: Is tourism an exception?

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  • Adriana Di Liberto

Abstract

Despite the emphasis placed by growth models on technological progress, recent empirical evidence shows that tourism, a sector widely regarded as low-skill/low-tech and one of the fastest growing industries in the world, may offer a favorable strategy for growth. In addition, in this tourism-led growth literature it is not clear whether human capital plays a role. Using a panel of 72 countries (1980--2005) this study shed new light on the effect of tourism and human capital for economic growth. While our results confirm that the tourism sector indicator is always positive and significant in growth regressions they also show that increased education contributes to growth and that the role of the tourism sector is significantly larger in countries with higher aggregate levels of human capital. Our main results are robust to the inclusion of additional variables, the use of alternative estimators in the regression analysis and the use of different sub-samples. Overall, our results suggest that an increase in human capital endowments is always beneficial, even when the development strategy focuses on the expansion of a (successful) unskilled sector.

Suggested Citation

  • Adriana Di Liberto, 2013. "High skills, high growth: Is tourism an exception?," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 22(5), pages 749-785, August.
    • Handle: RePEc:taf:jitecd:v:22:y:2013:i:5:p:749-785
    DOI: 10.1080/09638199.2011.603054
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    References listed on IDEAS

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    1. Maurice J. G. Bun & Frank Windmeijer, 2010. "The weak instrument problem of the system GMM estimator in dynamic panel data models," Econometrics Journal, Royal Economic Society, vol. 13(1), pages 95-126, February.
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    3. Sara Proença & Elias Soukiazis, 2008. "Tourism as an Economic Growth Factor: A Case Study for Southern European Countries," Tourism Economics, , vol. 14(4), pages 791-806, December.
    4. Stephen Bond & Anke Hoeffler & Jonathan Temple, 2001. "GMM Estimation of Empirical Growth Models," Economics Papers 2001-W21, Economics Group, Nuffield College, University of Oxford.
    5. Adriana Di Liberto, 2007. "Convergence and Divergence in Neoclassical Growth Models with Human Capital," Economia politica, Società editrice il Mulino, issue 2, pages 289-322.
    6. Juan Luis Eugenio-Martín & Noelia Martín Morales & Riccardo Scarpa, 2004. "Tourism and Economic Growth in Latin American Countries: A Panel Data Approach," Working Papers 2004.26, Fondazione Eni Enrico Mattei.
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    Cited by:

    1. Hatemi-J, Abdulnasser & MANESCHIÖLD, Per-Ola, 2021. "Testing for the Tourism Led Economic Growth Hypothesis in Sweden with Structural Breaks," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 74(3), pages 293-310.
    2. MARQUES SANTOS Anabela & MADRID Carmen & HAEGEMAN Karel & RAINOLDI Alessandro, 2020. "Behavioural changes in tourism in times of Covid-19: Employment scenarios and policy options," JRC Research Reports JRC121262, Joint Research Centre.
    3. Andrzej Tucki & Korneliusz Pylak, 2021. "Collective or Individual? What Types of Tourism Reduce Economic Inequality in Peripheral Regions?," Sustainability, MDPI, vol. 13(9), pages 1-16, April.
    4. Adelaida Lillo-Bañuls & José M. Casado-Díaz, 2012. "Individual Returns to Education in the Spanish Tourism Sector during the Economic Crisis," Tourism Economics, , vol. 18(6), pages 1229-1249, December.
    5. Inchausti-Sintes, Federico, 2015. "Tourism: Economic growth, employment and Dutch Disease," Annals of Tourism Research, Elsevier, vol. 54(C), pages 172-189.

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    More about this item

    JEL classification:

    • I21 - Health, Education, and Welfare - - Education - - - Analysis of Education
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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