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Temporal Granger causality and the dynamics examination on the tourism-growth nexus in Malaysia

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  • Tang, Chor Foon

Abstract

This study applied the cointegration, error-correction modelling and persistence profile to analyse the dynamic relationship between real tourism receipts, real income and real exchange rate in Malaysia. This study covers the annual sample period from 1974 to 2009. This study finds that the variables are cointegrated. In the short run, this study finds that neutrality causality between real tourism receipts and real income, while they are bi-directional Granger causality in the long run. Nevertheless, this study finds uni-directional causality running from real exchange rate to real tourism receipts and real income in both short- and long run.

Suggested Citation

  • Tang, Chor Foon, 2011. "Temporal Granger causality and the dynamics examination on the tourism-growth nexus in Malaysia," MPRA Paper 29237, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:29237
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    File URL: https://mpra.ub.uni-muenchen.de/29237/2/MPRA_paper_29237.pdf
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    References listed on IDEAS

    as
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    3. Kremers, Jeroen J M & Ericsson, Neil R & Dolado, Juan J, 1992. "The Power of Cointegration Tests," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 54(3), pages 325-348, August.
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    5. Zivot, Eric & Andrews, Donald W K, 2002. "Further Evidence on the Great Crash, the Oil-Price Shock, and the Unit-Root Hypothesis," Journal of Business & Economic Statistics, American Statistical Association, vol. 20(1), pages 25-44, January.
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    More about this item

    Keywords

    Causality; Exchange rate; Malaysia; Tourism-led growth; Persistence profile;

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East
    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes

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