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Causality between Foreign Direct Investment and Tourism: Empirical Evidence from India

  • Saroja Selvanathan

    (Griffith Business School, Griffith University, Queensland, Australia)

  • Selvanathan

    (Griffith Business School, Griffith University, Queensland, AustraliaAuthor-Email: kausik@mse.ac.in)

  • Brinda Viswanathan

    ()

    (Madras School of Economics)

This paper investigates the causal link between foreign direct investment and tourism in India by employing the Granger causality test under a VAR framework. A one-way causality link is found from foreign direct investment to tourism in India. This evidence once again adds to the need for appropriate policies and plans to further expand and develop tourism given that FDI flow into India is expected to be strong in the coming years, bringing along a demand for tourism as well.

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File URL: http://www.mse.ac.in/pub/working%20paper%2046.pdf
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Paper provided by Madras School of Economics,Chennai,India in its series Working Papers with number 2009-046.

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Length: 26 pages
Date of creation: Apr 2009
Date of revision:
Handle: RePEc:mad:wpaper:2009-046
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  1. Toda, Hiro Y & Phillips, Peter C B, 1993. "Vector Autoregressions and Causality," Econometrica, Econometric Society, vol. 61(6), pages 1367-93, November.
  2. Kundu, Sumit K. & Contractor, Farok J., 1999. "Country location choices of service multinationals: An empirical study of the international hotel sector," Journal of International Management, Elsevier, vol. 5(4), pages 299-317.
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