IDEAS home Printed from https://ideas.repec.org/a/sae/toueco/v21y2015i3p685-696.html
   My bibliography  Save this article

Research Note: Macroeconomic Impacts of the Tourism Industry and the Contemporaneous Feedback Effect — An Australian Case Study

Author

Listed:
  • Taha Chaiechi

    (Economics and Marketing Academic Group, College of Business, Law and Governance, James Cook University, PO Box 6811, Cairns, QLD 4870, Australia)

  • Josephine Pryce

    (Governence and Management Academic Group, College of Business, Law and Governance, James Cook University, Cairns, QLD, Australia)

  • Abhishek Bhati

    (College of Business, Law and Governance, James Cook University, Singapore)

Abstract

The aim of this paper is to demonstrate methods for analysing the dynamic impact of the tourism sector on key drivers of economic growth for destinations in Australia, while allowing for simultaneity of economic variables. The tourism sector is captured through the proxy of ‘tourism receipts’. In addition, investment and productivity growth are selected as sources of economic growth, in accordance with post-Keynesian growth theory. The paper uses time series quarterly data, covering the period 1995:Q1–2011:Q4, and employs time series estimation techniques, including structural vector autoregressive modelling and impulse response analysis, to describe the macroeconomic responses to sudden shocks in the tourism sector. The results indicate that the growth benefits of an increase in tourist expenditure are positive and statistically significant. Moreover, as suggested by the analysis of impulse response functions, a positive shock to tourist expenditure provides positive, substantial and rather long-lived implications regarding productivity and investment decisions.

Suggested Citation

  • Taha Chaiechi & Josephine Pryce & Abhishek Bhati, 2015. "Research Note: Macroeconomic Impacts of the Tourism Industry and the Contemporaneous Feedback Effect — An Australian Case Study," Tourism Economics, , vol. 21(3), pages 685-696, June.
    • Handle: RePEc:sae:toueco:v:21:y:2015:i:3:p:685-696
    DOI: 10.5367/te.2013.0364
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.5367/te.2013.0364
    Download Restriction: no
    File URL: https://libkey.io/10.5367/te.2013.0364?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. Blanchard, Olivier Jean & Quah, Danny, 1989. "The Dynamic Effects of Aggregate Demand and Supply Disturbances," American Economic Review, American Economic Association, vol. 79(4), pages 655-673, September.
    2. Rinaldo Brau & Adriana Di Liberto & Francesco Pigliaru, 2011. "Tourism and Development: A Recent Phenomenon Built on Old (Institutional) Roots?," The World Economy, Wiley Blackwell, vol. 34(3), pages 444-472, March.
    3. Chia-Lin Chang & Thanchanok Khamkaew & Michael McAleer, 2012. "IV Estimation of a Panel Threshold Model of Tourism Specialization and Economic Development," Tourism Economics, , vol. 18(1), pages 5-41, February.
    4. Holzner, Mario, 2011. "Tourism and economic development: The beach disease?," Tourism Management, Elsevier, vol. 32(4), pages 922-933.
    5. Chaiechi, Taha, 2012. "Financial development shocks and contemporaneous feedback effect on key macroeconomic indicators: A post Keynesian time series analysis," Economic Modelling, Elsevier, vol. 29(2), pages 487-501.
    6. Chia-Lin Chang & Thanchanok Khamkaew & Michael McAleer, 2009. "A Panel Threshold Model of Tourism Specialization and Economic Development," CIRJE F-Series CIRJE-F-685, CIRJE, Faculty of Economics, University of Tokyo.
    7. MacKinnon, James G & Haug, Alfred A & Michelis, Leo, 1999. "Numerical Distribution Functions of Likelihood Ratio Tests for Cointegration," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 14(5), pages 563-577, Sept.-Oct.
    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. Jorge M. Andraz & Nélia M. Norte & Hugo S. Gonçalves, 2016. "Do tourism spillovers matter in regional economic analysis? An application to Portugal," Tourism Economics, , vol. 22(5), pages 939-963, October.

    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. Ronald Kumar, 2014. "Exploring the role of technology, tourism and financial development: an empirical study of Vietnam," Quality & Quantity: International Journal of Methodology, Springer, vol. 48(5), pages 2881-2898, September.
    2. Antonakakis, Nikos & Dragouni, Mina & Eeckels, Bruno & Filis, George, 2015. "Tourism and economic growth revisited: Empirical evidence from a Panel VAR approach," MPRA Paper 67419, University Library of Munich, Germany.
    3. Ronald Ravinesh Kumar & Peter Josef Stauvermann & Nikeel Kumar & Syed Jawad Hussain Shahzad, 2019. "Exploring the effect of ICT and tourism on economic growth: a study of Israel," Economic Change and Restructuring, Springer, vol. 52(3), pages 221-254, August.
    4. Shahbaz, Muhammad & Kumar, Ronald Ravinesh & Ivanov, Stanislav & Loganathan, Nanthakumar, 2015. "Nexus between Tourism demand and output per capita with relative importance of trade and financial development: A study of Malaysia," MPRA Paper 67226, University Library of Munich, Germany, revised 11 Oct 2015.
    5. Ronald Kumar, 2014. "Exploring the nexus between tourism, remittances and growth in Kenya," Quality & Quantity: International Journal of Methodology, Springer, vol. 48(3), pages 1573-1588, May.
    6. Jun Zhang & Li Cheng, 2019. "Threshold Effect of Tourism Development on Economic Growth Following a Disaster Shock: Evidence from the Wenchuan Earthquake, P.R. China," Sustainability, MDPI, vol. 11(2), pages 1-22, January.
    7. Ronald Kumar & Nanthakumar Loganathan & Arvind Patel & Radika Kumar, 2015. "Nexus between tourism earnings and economic growth: a study of Malaysia," Quality & Quantity: International Journal of Methodology, Springer, vol. 49(3), pages 1101-1120, May.
    8. Carlos J. García & Andrés Sagner, 2011. "Crédito, Exceso de toma de Riesgo, Costo de Crédito y ciclo Económico en Chile," Working Papers Central Bank of Chile 645, Central Bank of Chile.
    9. Ines Perez-Soba Aguilar & Elena Marquez de la Cruz & Ana Rosa Martinez-Canete & Alfonso Palacio-Vera, 2006. "Capital Stock and Unemployment: Searching for the Missing Link," Economics Working Paper Archive wp_475, Levy Economics Institute.
    10. Hippolyte d'Albis & Ekrame Boubtane & Dramane Coulibaly, 2016. "Immigration Policy and Macroeconomic Performance in France," Annals of Economics and Statistics, GENES, issue 121-122, pages 279-308.
    11. Maurizio Bovi, 2014. "Shocks and the Expectations Formation Process. A Tale of Two Expectations," Natural Field Experiments 00390, The Field Experiments Website.
    12. Haug, Alfred A. & Karagedikli, Ozer & Ranchhod, Satish, 2005. "Monetary policy transmission mechanisms and currency unions: A vector error correction approach to a Trans-Tasman currency union," Journal of Policy Modeling, Elsevier, vol. 27(1), pages 55-74, February.
    13. Antonakakis, Nikolaos & Dragouni, Mina & Eeckels, Bruno & Filis, George, 2016. "Tourism and economic growth: Does democracy matter?," Annals of Tourism Research, Elsevier, vol. 61(C), pages 258-264.
    14. Giancarlo Corsetti & Panagiotis T. Konstantinou, 2012. "What Drives US Foreign Borrowing? Evidence on the External Adjustment to Transitory and Permanent Shocks," American Economic Review, American Economic Association, vol. 102(2), pages 1062-1092, April.
    15. Valter Di Giacinto & Giacinto Micucci & Pasqualino Montanaro, 2010. "Dynamic Macroeconomic Effects of Public Capital: Evidence from Regional Italian Data," Giornale degli Economisti, GDE (Giornale degli Economisti e Annali di Economia), Bocconi University, vol. 69(1), pages 29-66, April.
    16. Abdulkarim K. Alhowaish, 2016. "Is Tourism Development a Sustainable Economic Growth Strategy in the Long Run? Evidence from GCC Countries," Sustainability, MDPI, vol. 8(7), pages 1-10, June.
    17. van Zandweghe, Willem & Gottschalk, Jan, 2001. "Do Bivariate SVAR Models with Long-Run Identifying Restrictions Yield Reliable Results? The Case of Germany," Kiel Working Papers 1068, Kiel Institute for the World Economy (IfW Kiel).
    18. Taotao Deng & Mulan Ma & Shuai Shao, 2014. "Research Note: Has International Tourism Promoted Economic Growth in China? A Panel Threshold Regression Approach," Tourism Economics, , vol. 20(4), pages 911-917, August.
    19. Ulrich Gunter & M. Graziano Ceddia & David Leonard & Bernhard Tröster, 2018. "Contribution of international ecotourism to comprehensive economic development and convergence in the Central American and Caribbean region," Applied Economics, Taylor & Francis Journals, vol. 50(33), pages 3614-3629, July.
    20. Hippolyte d'Albis & Ekrame Boubtane & Dramane Coulibaly, 2015. "Immigration Policy and Macroeconomic Performance in France," Working Papers halshs-01162441, HAL.

    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:21:y:2015:i:3:p:685-696. 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.