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The Exchange Rate and US Tourism Trade, 1973–2007

Author

Listed:
  • Ka Ming Cheng

    (Department of Economics and Finance, Hang Seng Management College, Hong Kong)

  • Hyeongwoo Kim

    (Department of Economics, Auburn University, AL 36849, USA)

  • Henry Thompson

    (Department of Economics, Auburn University, AL 36849, USA)

Abstract

This paper investigates exchange rate effects on US tourism trade in structural vector autoregressive models with quarterly data for the floating exchange rate from 1973 to 2007. Tourism export revenue and import spending are examined along with the tourism trade balance. Depreciation raises the US tourism trade balance with a unit elastic effect after six quarters with no evidence of J-curve behaviour. Only export revenue is marginally sensitive to the exchange rate. Foreign travel is a luxury good for US tourists, while travel to the USA is a normal good for foreign tourists.

Suggested Citation

  • Ka Ming Cheng & Hyeongwoo Kim & Henry Thompson, 2013. "The Exchange Rate and US Tourism Trade, 1973–2007," Tourism Economics, , vol. 19(4), pages 883-896, August.
    • Handle: RePEc:sae:toueco:v:19:y:2013:i:4:p:883-896
    DOI: 10.5367/te.2013.0227
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    References listed on IDEAS

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    Cited by:

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    2. Ferhat Citak, 2018. "Exchange Rate and Turkish Tourism Trade," International Journal of Economics and Financial Issues, Econjournals, vol. 8(4), pages 206-213.
    3. Junwook Chi, 2015. "Dynamic Impacts of Income and the Exchange Rate on US Tourism, 1960–2011," Tourism Economics, , vol. 21(5), pages 1047-1060, October.
    4. Siamand Hesami & Bezhan Rustamov & Husam Rjoub & Wing-Keung Wong, 2020. "Implications of Oil Price Fluctuations for Tourism Receipts: The Case of Oil Exporting Countries," Energies, MDPI, vol. 13(17), pages 1-17, August.
    5. Gokhan H. Akay & Atilla Cifter & Ozdemir Teke, 2017. "Turkish tourism, exchange rates and income," Tourism Economics, , vol. 23(1), pages 66-77, February.

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