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Investigating the Effects of Advancements in Information and Communication Technology and Financial Development on Tourism Growth: A Case of South Africa

Author

Listed:
  • Ssekitoleko Patrick

    (Department of Business Management, College of Business & Economics University of Johannesburg (APB Campus), Johannesburg, South Africa)

  • Manaliyo Jean Claude

    (School of Tourism Management & TREES North-West University, Mahikeng, South Africa)

Abstract

Research background South Africa’s tourism industry has been experiencing unstable growth in the past few decades due to different factors. Studies in different countries have documented the significance of information and communications technology (ICT), and financial development towards a country’s tourism growth. ICT and financial development may stimulate the growth of South Africa’s tourism industry. Purpose To investigate the extent to which ICT advancements and financial development influence tourism growth in South Africa, given that the country has relatively strong financial and ICT sectors. Research methodology The study used annual time-series data for the period 1989 to 2019, and the variables are financial development, ICT, and tourism growth. The data were analysed using the Autoregressive Distributed Lag (ARDL) model. Results The findings indicate the existence of a long-run relationship among the variables. Results for the long-run estimates show that only ICT has a positive and statistically significant effect on tourism growth. In the short-run, financial development has a positive significant effect on tourism growth, while ICT only registers a significant effect on tourism growth in the fourth lag, albeit negative. The policy implication of these results is that the South African government ought to promote financial development to ensure that money is available and accessible for investment in tourism businesses and for tourist spending. Furthermore, ICT upgrades are required by the government and tourism service providers to enhance tourism products and service accessibility for tourists from wider geographical locations. Novelty This study expanded the existing literature by assessing the effects of ICT and financial development on South Africa’s tourism.

Suggested Citation

  • Ssekitoleko Patrick & Manaliyo Jean Claude, 2024. "Investigating the Effects of Advancements in Information and Communication Technology and Financial Development on Tourism Growth: A Case of South Africa," Folia Oeconomica Stetinensia, Sciendo, vol. 24(2), pages 304-326.
    • Handle: RePEc:vrs:foeste:v:24:y:2024:i:2:p:304-326:n:1015
    DOI: 10.2478/foli-2024-0027
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    References listed on IDEAS

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    More about this item

    Keywords

    ICT; Financial development; Tourism; ARDL; South Africa;
    All these keywords.

    JEL classification:

    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • G00 - Financial Economics - - General - - - General
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O38 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Government Policy
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa

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