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Tourism, Economic Expansion and Poverty in Nicaragua: Investigating Cointegration and Causal Relations

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  • Vanegas Sr., Manuel
  • Croes, Robertico

Abstract

This study examines the causal relationship between tourism expansion, economic growth and poverty for the Nicaraguan economy. Using co-integration and causality tests, the study’s results lend support to the proposition that tourism has a significant positive impact on Nicaragua’s economic expansion and development. With the knowledge from the output test, the study uses a regression analysis to test the hypothesis that income growth and tourism development would lead to a decline in the proportion of people below the poverty line. The paper presents arguments in support of the proposition that tourism, as a source of economic growth and development, offers a convincing case for the use of policy instruments focused to drive a tourism-based economy or tourism programs. It discusses its potential to stimulate further research designed to have the best available estimates of tourism impacts on variables such as economic growth and poverty.

Suggested Citation

  • Vanegas Sr., Manuel & Croes, Robertico, 2007. "Tourism, Economic Expansion and Poverty in Nicaragua: Investigating Cointegration and Causal Relations," Staff Papers 7306, University of Minnesota, Department of Applied Economics.
    • Handle: RePEc:ags:umaesp:7306
    DOI: 10.22004/ag.econ.7306
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    Cited by:

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    2. Asif Khan & Sughra Bibi & Ardito Lorenzo & Jiaying Lyu & Zaheer Udden Babar, 2020. "Tourism and Development in Developing Economies: A Policy Implication Perspective," Sustainability, MDPI, vol. 12(4), pages 1-19, February.
    3. Klytchnikova, Irina & Dorosh, Paul, 2012. "Tourism sector in Panama : regional economic impacts and the potential to benefit the poor," Policy Research Working Paper Series 6183, The World Bank.
    4. Turgut Bayramoğlu & Yılmaz Onur Arı, 2015. "The relationship between tourism and economic growth in greece economy: a time series analysis," Computational Methods in Social Sciences (CMSS), "Nicolae Titulescu" University of Bucharest, Faculty of Economic Sciences, vol. 3(1), pages 89-93, June.
    5. Robertico Croes & Manuel A. Rivera, 2017. "Tourism’s potential to benefit the poor," Tourism Economics, , vol. 23(1), pages 29-48, February.
    6. Bichaka Fayissa & Christian Nsiah & Bedassa Tadesse, 2011. "Research Note: Tourism and Economic Growth in Latin American Countries – Further Empirical Evidence," Tourism Economics, , vol. 17(6), pages 1365-1373, December.
    7. Shah Imtiyaz Ahmad & Haq Imtiyaz ul, 2022. "The Impact of Tourism Development and Economic Growth on Poverty Reduction in Kazakhstan," Acta Universitatis Sapientiae, Economics and Business, Sciendo, vol. 10(1), pages 77-90, September.
    8. Alfonsus Budi Susanto, 2019. "The Effect Of Government Policy And Environmental Sustainability On The Performance Of Tourism Business Competitiveness: Empirical Assessment On The Reports Of International Tourism Agencies," International Journal of Energy Economics and Policy, Econjournals, vol. 9(6), pages 439-446.
    9. Irina Klytchnikova & Paul Dorosh, 2013. "Tourism sector in Panama: Regional economic impacts and the potential to benefit the poor," Natural Resources Forum, Blackwell Publishing, vol. 37(2), pages 70-79, May.

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    Food Security and Poverty; International Development;

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