Tourism and Economic Growth in Latin American Countries: A Panel Data Approach
We consider the relationship between tourism and economic growth for Latin American countries since 1985 until 1998. The analysis proposed is based on a panel data approach and the Arellano-Bond estimator for dynamic panels. We obtain estimates of the relationship between economic growth and growth in tourists per capita conditional on main macroeconomic variables. We show that the tourism sector is adequate for the economic growth of medium or low-income countries, though not necessarily for developed countries. We then invert the causality direction of the analysis. Rather than explaining economic growth, we try to explain tourism arrivals conditional on GDP and other covariates such as safety, prices and education level, and investment in infrastructures. We employ a generalised least squares AR(1) panel data model. The results provide evidence that low-income countries seem to need adequate levels of infrastructures, education and development to attract tourists. Medium-income countries need high levels of social development like health services and high GDP per capita levels. Finally, the results disclose that price of the destination, in terms of exchange rate and PPP is irrelevant for tourism growth.
|Date of creation:||Feb 2004|
|Date of revision:|
|Contact details of provider:|| Postal: Corso Magenta, 63 - 20123 Milan|
Web page: http://www.feem.it/
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Barro, R.J., 1989.
"Economic Growth In A Cross Section Of Countries,"
RCER Working Papers
201, University of Rochester - Center for Economic Research (RCER).
- Andreas Papatheodorou, 1999. "The demand for international tourism in the Mediterranean region," Applied Economics, Taylor & Francis Journals, vol. 31(5), pages 619-630.
- Brännäs, Kurt & Hellström, Jörgen & Nordström, Jonas, 1999.
"A New Approach to Modelling and Forecasting Monthly Guest Nights in Hotels,"
Umeå Economic Studies
503, Umeå University, Department of Economics.
- Brannas, Kurt & Hellstrom, Jorgen & Nordstrom, Jonas, 2002. "A new approach to modelling and forecasting monthly guest nights in hotels," International Journal of Forecasting, Elsevier, vol. 18(1), pages 19-30.
- N. Gregory Mankiw & David Romer & David N. Weil, 1992.
"A Contribution to the Empirics of Economic Growth,"
The Quarterly Journal of Economics,
Oxford University Press, vol. 107(2), pages 407-437.
- Manuel Arellano & Stephen Bond, 1991.
"Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations,"
Review of Economic Studies,
Oxford University Press, vol. 58(2), pages 277-297.
- Tom Doan, . "RATS program to replicate Arellano-Bond 1991 dynamic panel," Statistical Software Components RTZ00169, Boston College Department of Economics.
- Lisa C. Chase & David R. Lee & William D. Schulze & Deborah J. Anderson, 1998. "Ecotourism Demand and Differential Pricing of National Park Access in Costa Rica," Land Economics, University of Wisconsin Press, vol. 74(4), pages 466-482.
- Barro, Robert J, 2000. "Inequality and Growth in a Panel of Countries," Journal of Economic Growth, Springer, vol. 5(1), pages 5-32, March.
- Kulendran, N. & King, Maxwell L., 1997. "Forecasting international quarterly tourist flows using error-correction and time-series models," International Journal of Forecasting, Elsevier, vol. 13(3), pages 319-327, September.
- Rugg, Donald, 1973. "The Choice of Journey Destination: A Theoretical and Empirical Analysis," The Review of Economics and Statistics, MIT Press, vol. 55(1), pages 64-72, February.
When requesting a correction, please mention this item's handle: RePEc:fem:femwpa:2004.26. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (barbara racah)
If references are entirely missing, you can add them using this form.