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The Effect of Tourism Revenues and Inflation on Economic Growth in Balkan Countries

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  • Bahman Huseynli

Abstract

Earnings from the tourism industry not only contribute to the expansion of an area's or nation's economy, but also result in the development of new jobs across a variety of industries, the accumulation of foreign currency, and the upgrading of economic infrastructure over the longer term. The purpose of this research is to investigate how income from tourism and inflation rates affect the pace of economic expansion in nations located in the Balkan region (Albania, Bosnia and Herzegovina, Bulgaria, Montenegro, North Macedonia, Greece, Serbia, Croatia, Slovenia, Romania). The Balkans, the region of dynamic developments, diversity of lifestyles, rich historical heritage and authentic culture from ancient civilizations to the present, has various tourism potentials such as sea tourism, mountain tourism, cultural tourism, rural tourism, health tourism and ecotourism. The research covers the years 2005-2020 and includes data on the variables that impact economic development in the nations that make up the Balkan region. Since there were significant gaps in Kosovo's data, the country was excluded from the research. Panel data analysis was used in the research to investigate macroeconomic variables such as foreign tourism revenues and inflation rates in these nations. Both of these factors are related to tourism. In the research that was conducted using a panel analysis method, the conclusive analysis wasn't begun until after the appropriate assumption tests had been carried out. It has been determined, via the use of the Driscoll-Kraay technique of estimating, whether or not these factors have an effect on economic growth. Based on the data that was collected as a result of the investigation, it was determined that the expansion of the tourism sector in the nations that were chosen from the Balkan region does not have a substantial impact on the overall growth of the economies of these countries. In a similar vein, inflation rates were completely unrelated to growth.

Suggested Citation

  • Bahman Huseynli, 2024. "The Effect of Tourism Revenues and Inflation on Economic Growth in Balkan Countries," Economic Studies journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 1, pages 150-165.
    • Handle: RePEc:bas:econst:y:2024:i:1:p:150-165
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    More about this item

    JEL classification:

    • Z32 - Other Special Topics - - Tourism Economics - - - Tourism and Development
    • H27 - Public Economics - - Taxation, Subsidies, and Revenue - - - Other Sources of Revenue
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe

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