IDEAS home Printed from https://ideas.repec.org/a/sae/toueco/v14y2008i4p673-690.html
   My bibliography  Save this article

The Role of Economic Development in Tourism Demand

Author

Listed:
  • Juan L. Eugenio-Martin

    (Departamento de Análisis Económico Aplicado, Universidad de Las Palmas de Gran Canaria, Spain, and Department of Land Economy, University of Cambridge, 19 Silver Street, CB3 9EP, UK)

  • Noelia Martín-Morales

    (Instituto Canario de Estadística, Las Palmas de Gran Canaria, Spain)

  • M. Thea Sinclair

    (formerly Christel DeHaan Tourism and Travel Research Institute, University of Nottingham, UK)

Abstract

This paper investigates the relevance of the supply-side characteristics of countries as determinants of the growth of tourism. Particular emphasis is placed on the role of economic development as a driver of tourism over time. Much of the literature on tourism has focused on the effects of tourism as an income generator. However, to attract tourists, it may be necessary to have a minimum threshold of economic development. This paper examines whether economic development is relevant to tourists' decision making. A cross-sectional time series model which deals with autocorrelation and heteroskedasticity in the error term is proposed. First, the model considers a worldwide panel data set of destination countries for tourists from Australia, France, Germany, Japan, Spain, the UK and the USA. Then, the sample is divided into smaller areas according to geographical and GDP criteria to investigate differences within competing countries in the same area. The results show that for the worldwide case, economic development matters and makes a difference to tourists' decision making. Subsample analysis shows that in those countries with high GDP levels, differences in economic development are not significant, whereas in developing countries they are.

Suggested Citation

  • Juan L. Eugenio-Martin & Noelia Martín-Morales & M. Thea Sinclair, 2008. "The Role of Economic Development in Tourism Demand," Tourism Economics, , vol. 14(4), pages 673-690, December.
    • Handle: RePEc:sae:toueco:v:14:y:2008:i:4:p:673-690
    DOI: 10.5367/000000008786440111
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.5367/000000008786440111
    Download Restriction: no
    File URL: https://libkey.io/10.5367/000000008786440111?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Tanya L. MacLaurin & Donald J. MacLaurin & Loi Soh Loi, 2000. "Impact of Food-Borne Illness on Food Safety Concerns of International Air Travellers," Tourism Economics, , vol. 6(2), pages 169-185, June.
    2. Baltagi, Badi H., 1986. "Pooling Under Misspecification: Some Monte Carlo Evidence on the Kmenta and the Error Components Techniques," Econometric Theory, Cambridge University Press, vol. 2(3), pages 429-440, December.
    3. Levine, Ross & Zervos, Sara J, 1993. "What We Have Learned about Policy and Growth from Cross-Country Regressions?," American Economic Review, American Economic Association, vol. 83(2), pages 426-430, May.
    4. Wolpin, Kenneth I, 1980. "A Time Series-Cross Section Analysis of International Variation in Crime and Punishment," The Review of Economics and Statistics, MIT Press, vol. 62(3), pages 417-423, August.
    5. Ram, Rati, 1987. "Exports and Economic Growth in Developing Countries: Evidence from Time-Series and Cross-Section Data," Economic Development and Cultural Change, University of Chicago Press, vol. 36(1), pages 51-72, October.
    6. Kavoussi, Rostam M., 1984. "Export expansion and economic growth : Further empirical evidence," Journal of Development Economics, Elsevier, vol. 14(1), pages 241-250.
    7. David Greenaway & David Sapsford, 1994. "What does liberalisation do for exports and growth?," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 130(1), pages 152-174, March.
    8. William Maloney & Gabriel V. Montes Rojas, 2005. "How elastic are sea, sand and sun? Dynamic panel estimates of the demand for tourism," Applied Economics Letters, Taylor & Francis Journals, vol. 12(5), pages 277-280.
    9. 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.
    10. Yair Eilat & Liran Einav, 2004. "Determinants of international tourism: a three-dimensional panel data analysis," Applied Economics, Taylor & Francis Journals, vol. 36(12), pages 1315-1327.
    11. Willem A. Naudé & Andrea Saayman, 2005. "Determinants of Tourist Arrivals in Africa: A Panel Data Regression Analysis," Tourism Economics, , vol. 11(3), pages 365-391, September.
    12. Jordan Shan & Ken Wilson, 2001. "Causality between trade and tourism: empirical evidence from China," Applied Economics Letters, Taylor & Francis Journals, vol. 8(4), pages 279-283.
    13. World Bank, 2004. "World Development Indicators 2004," World Bank Publications - Books, The World Bank Group, number 13890.
    14. Nikolaos Dritsakis, 2004. "Tourism as a Long-Run Economic Growth Factor: An Empirical Investigation for Greece Using Causality Analysis," Tourism Economics, , vol. 10(3), pages 305-316, September.
    15. Sinclair, M Thea & Sutcliffe, Charles M S, 1978. "The First Round of the Keynesian Regional Income Multiplier," Scottish Journal of Political Economy, Scottish Economic Society, vol. 25(2), pages 177-186, June.
    16. Adam Blake & M. Thea Sinclair & Guntur Sugiyarto, 2003. "Quantifying the Impact of Foot and Mouth Disease on Tourism and the UK Economy," Tourism Economics, , vol. 9(4), pages 449-465, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Yanxia Wang & Jianping Yang & Fan Tang & Qiuling Ge & Qingshan He & Xun Dai, 2022. "Analysis of the Reciprocal Feedback between Glacier Tourism Development and Regional Economic Growth in Hailuogou," Land, MDPI, vol. 12(1), pages 1-17, December.
    2. Martin Enilov & Yuan Wang, 2022. "Tourism and economic growth: Multi-country evidence from mixed-frequency Granger causality tests," Tourism Economics, , vol. 28(5), pages 1216-1239, August.
    3. Chen, Liang & Guo, Yirong, 2023. "Revisiting resources extraction perspective in determining the tourism industry: Globalisation and human capital for next-11 economies," Resources Policy, Elsevier, vol. 85(PA).
    4. Muntasir Murshed & Haider Mahmood & Tarek Tawfik Yousef Alkhateeb & Suvajit Banerjee, 2020. "Calibrating the Impacts of Regional Trade Integration and Renewable Energy Transition on the Sustainability of International Inbound Tourism Demand in South Asia," Sustainability, MDPI, vol. 12(20), pages 1-17, October.
    5. Blanka Škrabić Perić & Blanka Šimundić & Vinko Muštra & Marijana Vugdelija, 2021. "The Role of UNESCO Cultural Heritage and Cultural Sector in Tourism Development: The Case of EU Countries," Sustainability, MDPI, vol. 13(10), pages 1-14, May.
    6. Juan L Eugenio-Martin & Roberto Patuelli, 2022. "Panel data models in tourism research: Innovative applications and methods," Tourism Economics, , vol. 28(5), pages 1348-1354, August.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Boopen Seetanah & Kesseven Padachi & Sawkut Rojid, 2011. "Tourism and Economic Growth: African Evidence from Panel Vector Autoregressive Framework," WIDER Working Paper Series wp-2011-033, World Institute for Development Economic Research (UNU-WIDER).
    2. Andreas G. Georgantopoulos, 2013. "Tourism Expansion and Economic Development: Var/Vecm Analysis and Forecasts for the Case of India," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 3(4), pages 464-482, April.
    3. Christian Dreger & Dierk Herzer, 2013. "A further examination of the export-led growth hypothesis," Empirical Economics, Springer, vol. 45(1), pages 39-60, August.
    4. Joshua J. Lewer & Hendrik Van den Berg, 2003. "How Large Is International Trade’s Effect on Economic Growth?," Journal of Economic Surveys, Wiley Blackwell, vol. 17(3), pages 363-396, July.
    5. Ana María Cuadros Ramos, 2000. "Exportaciones y crecimiento económico: Un análisis de causalidad para México," Estudios Económicos, El Colegio de México, Centro de Estudios Económicos, vol. 15(1), pages 37-64.
    6. Yang, Chih-Hai & Lin, Hui-Lin & Han, Chia-Chun, 2010. "Analysis of international tourist arrivals in China: The role of World Heritage Sites," Tourism Management, Elsevier, vol. 31(6), pages 827-837.
    7. Rinaldo Brau & Anna Maria Pinna, 2013. "Movements of People for Movements of Goods?," The World Economy, Wiley Blackwell, vol. 36(10), pages 1318-1332, October.
    8. van den Berg, Hendrik, 1997. "The relationship between international trade and economic growth in Mexico," The North American Journal of Economics and Finance, Elsevier, vol. 8(1), pages 1-21.
    9. Sjoholm, Fredrik, 1999. "Exports, Imports and Productivity: Results from Indonesian Establishment Data," World Development, Elsevier, vol. 27(4), pages 705-715, April.
    10. Juan Gabriel Brida & Lionello F. Punzo & Wiston Adrián Risso, 2011. "Research Note: Tourism as a Factor of Growth – the Case of Brazil," Tourism Economics, , vol. 17(6), pages 1375-1386, December.
    11. Robertico Croes & Manuel A. Rivera, 2017. "Tourism’s potential to benefit the poor," Tourism Economics, , vol. 23(1), pages 29-48, February.
    12. Paolo Figini & Laura Vici, 2010. "Tourism and Growth in a Cross Section of Countries," Tourism Economics, , vol. 16(4), pages 789-805, December.
    13. Teelucksingh, Sonja S. & Watson, Patrick K., 2013. "Linking tourism flows and biological biodiversity in Small Island Developing States (SIDS): evidence from panel data," Environment and Development Economics, Cambridge University Press, vol. 18(4), pages 392-404, August.
    14. Asmawi Hashim & Norimah Rambeli & Norasibah Abdul Jalil & Normala Zulkifli & Emilda Hashim & Noor Al-Huda Abdul Karim, 2019. "Does Export Led Growth Hypothesis Hold Under World Crisis Recovery Regime in Malaysia?," Research in World Economy, Research in World Economy, Sciedu Press, vol. 10(5), pages 9-19, December.
    15. Subrata Ghatak & Chris Milner & Utku Utkulu, 1997. "Exports, export composition and growth : cointegration and causality evidence for Malaysia," Applied Economics, Taylor & Francis Journals, vol. 29(2), pages 213-223.
    16. Muhammad Amin Hasan & Mr. Abdullah & Muhammad Arsalan Hashmi & Ali Sajid, 2022. "International Remittances and International Tourism Development in South Asia: The Moderating Role of Political Stability," Journal of Economic Impact, Science Impact Publishers, vol. 4(3), pages 177-187.
    17. Smiljana Pivčević & Zvonimir Kuliš & Neven Šerić, 2016. "The pull factors of tourism demand: a panel data analysis for Latin American and Carribean countries," Tourism and Hospitality Industry 24, University of Rijeka, Faculty of Tourism and Hospitality Management.
    18. Nuno Carlos LEITÃO & Muhammad SHAHBAZ, 2012. "Migration and Tourism Demand," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 0(2(567)), pages 39-48, February.
    19. Neelu Seetaram & Sylvain Petit, 2012. "Panel data analysis in Tourism Research," Post-Print hal-01831529, HAL.
    20. Nuno, Carlos Leitão & Muhammad, Shahbaz, 2011. "Migration and Tourist Flows," MPRA Paper 34905, University Library of Munich, Germany, revised 12 Nov 2011.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:toueco:v:14:y:2008:i:4:p:673-690. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.