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Economic policy uncertainty and tourism: evidence from the heterogeneous panel

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  • Seyi Saint Akadiri
  • Andrew Adewale Alola
  • Gizem Uzuner

Abstract

In this paper, we examine whether tourism predicts economic policy uncertainty or not in three regions of America, Europe, and Asia-pacific, using annual frequency panel data that consist of 12 countries in a multivariate Granger causality model that incorporates economic growth as an additional variable over the periods 1995–2016. Using the panel Granger causality method as advanced by Emirmahmutoglu and Kose [(2011). Testing for Granger causality in heterogeneous mixed panels. Economic Modelling, 28(3), 870–876.] that produces country-specific Granger causality test statistic and also controlled for heterogeneity in panel data, we found two-way causality relationship between ITAs and EPU in France, Ireland and United State, and one-way causality relationship from ITAs to EPU in Brazil, Canada, China and Germany and neutrality hypothesis in Chile, Japan, South Korea, Russia and Sweden, respectively. These results suggest tourism-economic policy uncertainty led-hypothesis and economic policy uncertainty-tourism led hypothesis with worthy policy implications for tourism destinations across the world.

Suggested Citation

  • Seyi Saint Akadiri & Andrew Adewale Alola & Gizem Uzuner, 2020. "Economic policy uncertainty and tourism: evidence from the heterogeneous panel," Current Issues in Tourism, Taylor & Francis Journals, vol. 23(20), pages 2507-2514, October.
    • Handle: RePEc:taf:rcitxx:v:23:y:2020:i:20:p:2507-2514
    DOI: 10.1080/13683500.2019.1687662
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    Cited by:

    1. Saffet Akdağ & İlker Kılıç & Mert Gürlek & Andrew Adewale Alola, 2023. "Does economic policy uncertainty drive outbound tourism expenditures in 20 selected destinations?," Quality & Quantity: International Journal of Methodology, Springer, vol. 57(5), pages 4327-4337, October.
    2. Uju Violet Alola & Darya Baeva & Andrew Adewale Alola, 2023. "Determining the (A)symmetric Role of Business–Consumer Confidence in Outward–Inward Tourism in Russia: A Competitiveness Perspective," International Journal of Global Business and Competitiveness, Springer, vol. 18(1), pages 22-34, June.
    3. Hela B Hamida, 2024. "Cross-domain dynamics: How geopolitical and climate policy uncertainties shape tourism patterns in the United States," Tourism Economics, , vol. 30(7), pages 1835-1856, November.
    4. Xin Zhao & Muhammad Saeed Meo & Tella Oluwatoba Ibrahim & Noshaba Aziz & Solomon Prince Nathaniel, 2023. "Impact of Economic Policy Uncertainty and Pandemic Uncertainty on International Tourism: What do We Learn From COVID-19?," Evaluation Review, , vol. 47(2), pages 320-349, April.
    5. Abda Emam & Hassan Ali-Dinar, 2024. "Tourism’s Influence on Economic Growth and Environment in Saudi: Present and Future," Sustainability, MDPI, vol. 16(21), pages 1-17, November.
    6. Conrado Diego García-Gómez & Ender Demir & Ming-Hsiang Chen & José María Díez-Esteban, 2022. "Understanding the effects of economic policy uncertainty on US tourism firms’ performance," Tourism Economics, , vol. 28(5), pages 1174-1192, August.
    7. Sabani, Nazmie & Bales, Stephan & Burghof, Hans-Peter, 2024. "On the different impact of local and national sources of policy uncertainty on sectoral stock volatility," Research in International Business and Finance, Elsevier, vol. 72(PB).
    8. James E Payne & Nicholas Apergis, 2022. "The influence of economic policy uncertainty and geopolitical risk on US citizens overseas air passenger travel by regional destination," Tourism Economics, , vol. 28(5), pages 1333-1341, August.
    9. Uju Violet Alola & Ojonugwa Usman & Andrew Adewale Alola, 2023. "Is pass-through of the exchange rate to restaurant and hotel prices asymmetric in the US? Role of monetary policy uncertainty," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 9(1), pages 1-19, December.
    10. James E Payne & Saban Nazlioglu & Andrea Mervar, 2023. "Economic policy uncertainty and international tourist arrivals: A disaggregated analysis of the Croatian Adriatic coast," Tourism Economics, , vol. 29(4), pages 986-1004, June.
    11. Muhammad Zubair Chishti & Eyup Dogan, 2024. "Analyzing the determinants of renewable energy: The moderating role of technology and macroeconomic uncertainty," Energy & Environment, , vol. 35(2), pages 874-903, March.
    12. Yuting Gong & Chia-Hsun Chang & Paul Tae-Woo Lee & Jingbo Yin & Wenming Shi, 2024. "Unveiling the mystery of the responsiveness of inbound tourism to economic policy uncertainty: New evidence from Australia," Tourism Economics, , vol. 30(8), pages 2159-2180, December.
    13. Dervis Kirikkaleli & Andrew Adewale Alola, 2023. "The regime switching evidence of financial-economic-political risk in Turkey," Quality & Quantity: International Journal of Methodology, Springer, vol. 57(4), pages 3747-3762, August.

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