Proceedings of Eurasia Business Research Conference
16 - 18 June 2014, Nippon Hotel, Istanbul, Turkey, ISBN: 978-1-922069-54-2
Growth Effects of Leisure Tourism and Level of Economic
Development
Chung-ki Min and Taek-seon Roh1
This study examines, 1) whether leisure tourism can contribute to economic growth,
and 2) if it does, whether its growth effects are constant across levels of economic
development. Regarding the contribution to economic growth, leisure tourism differs
from business tourism in the causal relation. Furthermore, although resources are
limited for leisure tourism, they can be produced in the case of business one. This
notion has a significant implication for the relation between growth effects of leisure
tourism and level of economic development. Thus, the current study focuses on
leisure tourism by controlling for the effects of business tourism. The empirical findings
reveal that leisure tourism contributes to economic growth at an early stage of
economic development, but its contribution becomes insignificant as an economy
develops.
Keywords: Leisure tourism; Business tourism; Growth effects; Level of economic
development
JEL Classification: L83; O40
I. Introduction
International tourism has become one of the fastest-growing industries and is
widely believed to contribute to economic growth. According to the UN World Tourism
Organization report, the number of international tourists reached one billion in
November 2012; tourism receipts supported 9% of the world’s GDP and 8% of total
jobs. Naturally, researchers have been examining the causal relation between
tourism and economic growth. Many studies in the literature report that tourism
demand, in general, contributes significantly to the economic growth of countries,
particularly for under-developed and developing countries (Sequeria and MacasNunes, 2008; Fayissa, Nsiah, & Tadesse, 2011). It is understood that the primary
role of tourism at an early stage of economic development is to be a growth
stimulator; tourism allows foreign currency earnings, resulting in imports of capital
goods (Gunduz and Hatemi-J, 2005; Nowak, Sahli, & Cortes-Jimenez, 2007).
International tourism can be decomposed into two broad categories, leisure
and business tourism. This study defines that the principal purpose of leisure tourists
is to share and enjoy the physical and intangible culture, including landscapes, arts,
tradition and language. Thus, leisure tourism includes not only leisure and naturebased tourists, but also culturally-motivated and heritage-related tourists. In fact, it is
not easy to separate the different types of tourists from each other, because holiday
destinations often emerge from balancing a number of goals and criteria which are
leisure-, nature-, culture- and/or heritage-related (Bellini, Gasparino, Corpo, &
Malizia, 2007). Therefore, we adopt a broad definition of leisure tourism.
1
Both are professors in the department of Economics, Hankuk University of Foreign Studies, Seoul, Korea.
Email address: cmin@hufs.ac.kr (MIN), tsroh@hufs.ac.kr (ROH). This work was supported by the Hankuk
University of Foreign Studies Research Fund.
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Proceedings of Eurasia Business Research Conference
16 - 18 June 2014, Nippon Hotel, Istanbul, Turkey, ISBN: 978-1-922069-54-2
In contrast, the purpose of business tourism is primarily for public and business
arrangements and therefore, its destinations are more likely to be areas developed for
business purposes, such as cities and industrial regions. Historically, business tourism, in the
form of traveling to, spending money and staying abroad for some time, has a history as long
as that of international trade (Wikipedia: Business tourism). According to the empirical
results of Kulendran and Wilson (2000) and Shan and Wilson (2001), we observe a strong
reciprocal relationship between international travel and international trade.
For an economic analysis of tourism, it is important to differentiate between the two
categories, leisure and business tourism. One reason for such differentiation is that the supply
of tourism resources for each category is quite different. Resources for leisure tourism are
limited by its nature, whereas those for business tourism, basically hotels, convention centers
and restaurants, can be produced as the demand for business tourism increases. This
limitedness of resources for leisure tourism has a significant implication for the relation
between growth effects of leisure tourism and level of economic development, which is the
main issue of this study.
Another reason for differentiating leisure tourism from business one is that business
tourism is not an exogenous input to economic growth, but an input resulting from increased
international trade; however, leisure tourism is exogenously determined by foreign tourists.
When we examine whether tourism contributes to economic growth, we therefore need to
focus on an exogenous component of tourism, i.e., leisure tourism. To control for the
economic effects of business tourism, this study utilizes international trade volume as a proxy
variable for business tourism demand. To our knowledge, this is the first study which
separates leisure tourism from business one for testing whether leisure tourism leads to
economic growth.1
The objective of this study is to examine, theoretically and empirically, the role of
leisure tourism in economic growth. More specifically, we examine 1) whether leisure
tourism can contribute to economic growth, and 2) if it does, whether its growth effects are
constant across levels of economic development. The empirical results convey that leisure
tourism contributes to economic growth at an early stage of development; however, its
contribution becomes insignificant as the income level of an economy increases.
In the next section, we discuss the main issues of this study and also present the
related studies. Section 3 explains the models and section 4 reports the empirical results.
Concluding remarks and policy implications are provided in section 5.
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II. Issues and Related Studies
Two main issues are addressed in this study; one is about the contribution of leisure
tourism to economic growth and the other is about the relation between its contribution and
the level of economic development. Regarding the first issue, many studies in the literature
conduct a time-series analysis for each single country. Balaguer and Cantavella-Jorda (2002)
and Nowak et.al. (2007) analyze the time series data for Spain; Bonham, Gangnes, & Zhou
(2009) for Hawaii; Dritsakis (2004) for Greece; Gunduz and Hatemi-J (2005) and Katircioglu
(2009) for Turkey; Hye and Khan (2013) for Pakistan; Mishra, Rout, & Mohapatra (2011) for
India; and Kim, Chen, & Jang (2006) for Taiwan, among others. Most previous studies, but
not all, report empirical results supporting the tourism-led growth hypothesis for each
selected country; however, they do not separate leisure tourism from business one.
Regarding the second issue of whether the growth contribution is constant over
economic development, we depend on the endogenous economic growth theory developed by
Lucas (1988, 2002) and Romer (1986). According to the theory, primary industries (including
agriculture and commodity) soon reach a steady state at which no further growth is possible.
This is due to the declining marginal products of labor and capital as well as the declining
terms of trade in agricultural products and commodities. Continued economic growth is
possible when an economy achieves continued productivity improvements resulting from
high R&D investment and increased international trade. Thus, for a possibility of continued
growth contribution of leisure tourism, the relative price in the tourism industry has to
increase as much as the productivity improvements in other industries to make up for the gap
in productivity. If so, foreign tourists will have to spend more. However, in reality, the price
increase will not be large enough (Lanza and Pigliaru, 1995). Another possibility for
continued growth with leisure tourism is to heavily exploit tourism resources to make up for
the productivity gap. However, because natural and heritage-related resources are not
reproducible and will soon be polluted and exhausted, this is not possible either (Lanza and
Pigliaru, 2000). Therefore, the leisure-tourism-intensive economy will soon reach a steady
state at which the contribution of leisure tourism no longer increases (Brau, Lanza, & Pigliaru,
2007).
Thus, the growth contribution of leisure tourism diminishes and finally disappears as
an economy develops. If so, we will have to examine the contribution of leisure tourism
separately at each stage of economic development; this is the main issue of the study. To do it,
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Proceedings of Eurasia Business Research Conference
16 - 18 June 2014, Nippon Hotel, Istanbul, Turkey, ISBN: 978-1-922069-54-2
we use panel data and divide the sampled countries into groups depending on their income
levels. Using panel data, Brau et al. (2007) report that small countries benefit from tourism.
In contrast, Sequeria and Macas-Nunes (2008) show that small countries do not seem to
benefit from tourism specialization any more than does the average country; however, poor
countries do benefit from such specialization. These seemingly conflicting results could arise
if the stage of economic development determines the contribution of tourism. Kim et al.
(2006) also state that the level of economic development can be a factor for determining the
direction of causality between tourism and economic growth. Using panel data from Latin
American countries, Eugenio-Martin, Morales, & Scarpa (2004) and Fayissa et al. (2009)
indicate that tourism is associated with economic growth only in low- and medium-income
countries, but not in high-income countries. Lee and Chang (2008) also suggest that the
dissimilarities in the degree of economic development have to be considered in examining
whether the tourism and growth relationship differs in developed and developing economies.
Their empirical results indicate that tourism has a greater impact on GDP in non-OECD and
Sub-Sahara African countries compared to that in OECD countries. In contrast, Figini and
Vici (2010) claim that the causal relation between tourism specialization and economic
growth is significant only in the 1980s, but is not significant when the reliable data for the
1995-2005 period are used. Thus, many studies report mixed empirical results, stating that
some countries benefit from tourism and some do not; yet, they do not provide any
explanation.
This study attempts to fill this gap by explaining why the effects of leisure tourism
depend on the development stage (or income level) of a country. We argue that the primary
role of leisure tourism for economic growth is being a stimulator at an early stage of
development by earning foreign currencies to import capital goods (Gunduz and Hatemi-J,
2005; Nowak et al., 2007). As an economy grows, however, its contribution will diminish due
to a lack of productivity improvement. To examine this argument, we divide the sampled
countries into groups depending on their development stages. We expect that the economic
contribution of leisure tourism is significant in low-income countries, but not significant in
high-income countries.
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Proceedings of Eurasia Business Research Conference
16 - 18 June 2014, Nippon Hotel, Istanbul, Turkey, ISBN: 978-1-922069-54-2
III. Models
Tourism demand consists of two main components, leisure and business tourism
demand. Leisure tourism often uses specific natural and historical resources with limited
supply. Business tourism, however, is much less limited in the supply of resources. Hence,
business tourism can increase proportionally as an economy grows, resulting from an
increase in international trade. Based on the empirical analysis of the Korean economy, Oh
(2005) concludes that the export-driven economic growth can be a significant causal
component of tourism growth. Since the current study focuses on leisure tourism, we need to
separate leisure tourism from business one. Unfortunately, data are available only on the total
tourism demand, not on each component. Therefore, we need to separate the growth effects of
leisure tourism from those of business tourism. Considering that business tourism increases
proportionally to international trade, we use the sum of exports and imports as a proxy
variable for the growth effects of business tourism.
This study employs a three-variable vector autoregressive (VAR) model, an
extension of the two-variable VAR which is often used for testing whether tourism causes
economic growth. The extended three-variable VAR model includes the international trade
volume (TRADE) in addition to the two variables of economic growth and tourism demand.2
log GDPit   0  1 log GDPi ,t 1   2 log GDPi ,t 2   3 log TOURi ,t 1   4 log TOURi ,t 2
  5 log TRADEi ,t 1   6 log TRADEi ,t 2  (Year dummies)  ut
(1)
where log GDPit is the logarithmic real GDP per capita of country i in year t, a measure of
economic growth; log TOURi ,t 1 is the logarithmic real tourism receipts per capita of country
i in year t-1, a measure of the total tourism demand; and log TRADEi ,t 1 is the logarithmic
real international trade (sum of exports and imports) per capita, a proxy variable for business
tourism. Because tourism demand is highly volatile, particularly due to the effects of
economic downturns and natural disasters, such changes in each time period can distort the
test of the tourism-led growth hypothesis. Thus, we include year-dummy variables in order to
account for the time-specific effects.
The lag order of two has been selected by a sequential test. We start with a
sufficiently large lag (e.g., 5) and test down to the right lag order until we reject a null
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Proceedings of Eurasia Business Research Conference
16 - 18 June 2014, Nippon Hotel, Istanbul, Turkey, ISBN: 978-1-922069-54-2
hypothesis that the coefficients on the last lag are jointly zero. For a robustness check of the
selected lag order, we have also applied the Portmanteau test to examine whether the
residuals are autocorrelated. If the lag order of autoregressive models is not large enough, the
disturbances will be autocorrelated, leading to inconsistent estimates. This Portmanteau test
supports the selected lag order by concluding that the residuals are serially uncorrelated.
We also estimate a model of change-rate variables.
%GDPit   0  1 %GDPi ,t 1   2 %TOURi ,t 1   3 %TRADEi ,t 1
 (Year dummies)  et
(2)
where %△ denotes a percent change. Following the same procedures explained above, we
have selected the lag order of one. Using the change-rate variables, we can control for
heterogeneity across countries as well as for possible nonstationarity of the level variables.
However, since the annual data from 1995 to 2010 are not long, nonstationarity is not a major
concern in this study. The nonstationarity issues associated with unit roots apply to
asymptotic properties. Nonetheless, the use of change-rate variables can increase the
robustness of empirical results and also make this study comparable with other studies.
Further, if the VAR model in change-rate variables yields similar results to those for the VAR
in level variables, we can conclude that the results are not governed by the assumptions made
about nonstationarity (Hamilton, 1994, pp. 651-653).
Another concern about model specification is a bias caused by omitted variables. If a
variable is omitted from a regression model, the omitted variable can bias the least squares
(OLS) estimation only when it is a significant factor for the dependent variable and is also
significantly correlated with the explanatory variables. Suppose that in Eq.(2), a variable Wit
and its lagged one Wi ,t 1 are significant factors for the dependent variable %GDPit , but
omitted.
%GDPit   0  1 %GDPi ,t 1   2 %TOURi ,t 1   3 %TRADEi ,t 1
 (Year dummies)  { 0Wit   1Wi ,t 1  et*}
(3)
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Proceedings of Eurasia Business Research Conference
16 - 18 June 2014, Nippon Hotel, Istanbul, Turkey, ISBN: 978-1-922069-54-2
The contemporaneous omitted variable Wit , however, does not cause a bias because it is not
correlated with predetermined explanatory variables, %GDPi ,t 1 , %TOURi ,t 1 and
%TRADEi ,t 1 . The other omitted variable Wi ,t 1 is contained in an explanatory variable
%GDPi ,t 1 as the lag-one expression of Eq.(3) indicates %GDPi ,t 1   0   
( 0Wi ,t 1   1Wi ,t 2 )  et*1 . Now that the lagged dependent variable %GDPi ,t 1 can account
for the lagged omitted variable  1Wi ,t 1 , the bias due to Wi ,t 1 is substantially eliminated.
Therefore, the above three-variable VAR models, Eqs. (1) and (2), are expected to yield
unbiased results for the Granger-causality test.
IV. Data and Empirical Results
The annual data for the 1995-2010 period are collected from World Development
Indicators, World Bank. All variables are measured in the constant 2000 U.S. dollars and are
expressed in per capita figures in order to control for the country size: GDP, TOUR (tourism
receipts) and TRADE (international trade which is the sum of exports and imports). A total of
52 countries are grouped based on the average GDP per capita during the data period. The
three groups are LOW (< $2,000; 14 countries), MIDDLE ($2,000 ~ $15,000; 18 countries)
and HIGH (>$15,000; 20 countries). We also estimate the models for two groups, LOW (14
countries) and MEDIUM/HIGH (38 countries).
Table 1 shows the summary statistics of the level variables and their change rates. In
all countries, the tourism receipts (TOUR) have fluctuated a lot more than the GDP; the
standard deviation of %∆TOUR is bigger than that of %∆GDP for all countries. This
indicates that tourism demand is highly sensitive to economic fluctuations.
[TABLE 1 ABOUT HERE]
A scatterplot of tourism receipts (TOUR) and GDP in Figure 1 shows that tourism
receipts increase and then decrease as GDP increases. This is consistent with the above
prediction that tourism is important in low-income countries but its importance diminishes in
high-income countries. Figure 2 portrays the relation between international trade volume
(TRADE) and GDP; Figure 3 shows the same relation after excluding two outlying countries,
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Proceedings of Eurasia Business Research Conference
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Hong Kong and Singapore. Business tourism, measured by TRADE, appears to increase as an
economy grows.
[FIGURES 1, 2, 3 ABOUT HERE]
Table 2 reports the estimation results when the level variables are used and the
countries are grouped into two income levels, LOW and MIDDLE/HIGH.3 According to the
middle columns in Table 2, where the international trade volume (logTRADE) is included to
control for the effects of business tourism, the coefficients for logTOURi,t-1 and logTOURi,t-2
are jointly significant for the LOW group (p-value=0.088), but insignificant for the
MIDDLE/HIGH group (p-value=0.836) at the 10% significance level. These results support
the prediction that the economic contribution of leisure tourism is significant in lower-income
countries, but insignificant in higher-income countries.
In contrast, as shown by the last two columns in Table 2, the coefficients for
logTOURi,t-1 and logTOURi,t-2 are jointly significant for both groups when the international
trade volume is not included; the p-value is 0.043 for the LOW group and 0.047 for the
MIDDLE/HIGH group. Because the international trade variables are omitted, the TOUR
variable represents the total of leisure and business tourism. Thus, this model cannot separate
the effects of leisure tourism from those of business tourism, thereby yielding biased
estimates.
[TABLE 2 ABOUT HERE]
Table 3 shows the estimation results when the change-rate variables are used to
control for heterogeneous country effects and for possible nonstationarity of the level
variables. The results are qualitatively identical to the ones in Table 2, supporting the
prediction about the relation between the growth contribution of leisure tourism and the level
of economic development. When controlling for the effects of business tourism
using %∆TRADE, as shown by the middle columns in Table 3, the growth contribution of
leisure tourism is significant for the LOW income-level countries (p = 0.035), but
insignificant for the MIDDLE/HIGH income-level countries (p = 0.652).
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Proceedings of Eurasia Business Research Conference
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However, when the change rate of international trade (%∆TRADE) is not included,
the coefficient for %∆TOURi,t-1 is also significant for the MIDDLE/HIGH countries with a pvalue of 0.041, as shown by the last column in Table 3. This conflicting result is due to an
omission of the significant variable %∆TRADE, which is a proxy for business tourism. Note
that the lagged value of %∆TRADE is significant for the MIDDLE/HIGH group; the tstatistics is 3.57 (=0.068/0.019). As a result of the omission of %∆TRADEi,t-1, the coefficient
estimate of %∆TOURi,t-1 is confounded with the effects of business tourism.
[TABLE 3 ABOUT HERE]
The consistency in Tables 2 and 3 indicates that the empirical results about the
relation between the growth contribution of leisure tourism and the level of economic
development do not depend on whether the level variables are treated as being stationary or
nonstationary. Overall, we conclude that although leisure tourism can help an economy to
grow, its contribution is limited only for the early stage of development. For continued
growth, a country has to be industrialized through increased international trade. Consequently,
business tourism becomes important as a country develops.
V. Concluding Remarks
We have examined whether leisure tourism can contribute to economic growth and
whether its contribution is constant across levels of economic development. To do it, we
adopt a broad definition of leisure tourism which includes all non-business tourists. It is
because different types of tourists cannot be separated from each other; holiday destinations
often emerge from balancing a number of goals and criteria which are leisure-, nature-,
culture- and/or heritage-related. Regarding the contribution to economic growth, leisure
tourism has a different causal relation from business tourism. Leisure tourism is exogenously
determined by foreign tourists, but business tourism is resulted from increased international
trade. Furthermore, resources are limited for leisure tourism, but can be produced in the case
of business tourism. Thus, the issues of this study are focused on leisure tourism. The main
findings of this study reveal that leisure tourism contributes to economic growth at an early
stage of development, but has limitations in sustaining the growth contribution as an
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Proceedings of Eurasia Business Research Conference
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economy develops. These results are theoretically explained by the endogenous growth
theory. Hence, this study differs from previous studies because it separates leisure tourism
from business one and examines the leisure-tourism-led growth hypothesis separately at each
economic development stage.
Our empirical findings have policy implications. Leisure tourism can help an
economy to grow at an early stage of economic development. It suggests that low-income
countries use leisure tourism as a stepping stone for economic growth, and then utilize its
growth effects for the next stage of industrialization. Because the growth effects of leisure
tourism diminish, in order to retain a continued economic growth, countries have to achieve
productivity improvements by increasing R&D investment and international trade. Although
the growth effects of leisure tourism are insignificant for developing and developed countries,
it does not, however, mean that leisure tourism is not important. Leisure tourism can still
contribute to the wealth of the countries, both directly and indirectly. By attracting foreign
tourists, leisure tourism can create and improve the value of country brand, leading to an
increase in exports and earned foreign currencies. Domestically, unlike business tourism,
leisure tourism supports employment and income more in rural areas than in urban areas; this
is a significant role for improving regional development and regional economic revitalization
within a country.
Notes
1 An exception is Yang et al. (2010) which analyzes the determinants of international tourist arrivals in China,
especially for World Heritage Sites. Since China is very successful in attracting foreign capital, the authors
control for business travelers using the inflow of foreign capital.
2 Because the issue of this study is about the effect of leisure tourism (TOUR) on economic growth (GDP), we
estimate only the GDP equation in the three-variable VAR model.
3 When the countries are grouped into three income levels (LOW, MIDDLE, HIGH), the estimation results are
qualitatively identical to the ones in Tables 2 and 3, and thus are not reported here. The main purpose of
grouping countries is to show that the growth effects of leisure tourism are significant at an early stage of
economic development but become insignificant as an economy develops. Thus, how many groups to use is
not an issue. In addition, the number of countries in each group doesn’t have to be uniform across groups.
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Figure 1. Scatterplot of Tourism Receipts (TOUR) and GDP
Figure 2. Scatterplot of International Trade (TRADE) and GDP
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Figure 3. Scatterplot of International Trade (TRADE) and GDP:
Excluding Hong Kong and Singapore
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Table 1
Summary statistics of real GDP, real tourism receipts (TOUR) and real international trade (TRADE) per capita
change rate of
GDP (%)
GDP
Group
L
O
W
M
I
D
D
L
E
Country
Nepal
Cambodia
Nigeria
Kenya
India
Mongolia
Cote d’Ivoire
Indonesia
Bolivia
Philippines
China
Paraguay
Ecuador
Egypt
Russia
Thailand
Colombia
S. Africa
Brazil
Malaysia
Costa Rica
Turkey
Hungary
Chile
Mexico
Czech Rep.
Uruguay
(constant
2000 US $)
231
371
418
427
533
566
607
893
1060
1138
1319
1392
1472
1564
2168
2219
2749
3278
3932
4293
4345
4494
4979
5537
5731
6461
7114
change rate of
TOUR (%)
TOUR
GDP
TOUR
mean
1.94
5.91
2.72
0.81
5.15
3.90
-0.23
2.40
1.74
2.28
8.70
0.39
1.72
3.06
3.95
1.99
1.44
1.58
1.79
2.44
2.46
2.44
2.48
3.10
1.58
2.70
2.61
s.d.
1.47
3.20
2.74
2.11
2.20
3.22
2.63
5.15
1.54
2.14
1.72
4.88
3.39
1.38
5.36
4.82
2.73
2.06
2.43
4.36
2.97
5.00
3.03
1.92
3.17
3.01
4.85
(constant
2000 US $)
8
41
1
24
4
33
4
20
22
28
16
20
23
94
28
164
33
98
13
301
338
162
289
83
92
303
265
change rate of
TRADE (%)
mean
-3.42
17.95
7.11
-2.82
6.56
8.66
-4.89
-3.45
3.28
2.61
6.37
-2.38
0.78
4.64
2.67
3.90
1.56
4.78
6.56
4.23
1.97
3.43
0.69
0.44
-3.01
1.29
3.16
s.d.
29.60
23.43
56.58
28.62
10.48
38.46
16.49
20.94
20.51
30.85
12.00
21.90
16.74
18.61
18.02
9.30
14.40
10.77
23.78
16.37
11.32
22.21
13.06
8.82
5.18
9.94
16.23
(%)
3.46
9.78
0.26
5.75
0.79
5.69
0.66
2.34
2.03
2.43
1.25
1.40
1.60
5.90
1.36
7.38
1.21
2.95
0.32
6.90
7.76
3.60
6.01
1.52
1.63
4.78
3.70
TRADE
GDP
TRADE
(constant
2000 US $)
116
430
310
255
194
639
487
528
633
1040
723
1420
895
805
1204
2744
976
1830
898
8333
4019
2152
5878
3623
3358
7706
3437
mean
0.22
8.44
0.83
0.44
10.44
6.26
-0.18
1.56
4.53
1.48
11.30
-0.78
3.59
2.68
3.51
4.67
1.14
2.93
4.13
1.64
2.50
2.98
6.58
4.54
2.00
4.46
4.80
s.d.
8.52
13.47
13.46
9.80
8.51
10.16
5.32
18.88
10.43
10.67
11.46
12.91
11.57
11.57
11.31
9.98
6.26
12.38
10.83
6.78
9.49
12.71
9.69
7.73
7.20
8.41
10.98
(%)
50.58
110.64
74.82
59.44
33.83
111.67
80.51
60.13
58.84
92.22
51.44
101.55
60.22
50.64
56.05
121.93
35.47
55.31
22.67
195.17
92.13
47.72
135.52
64.49
58.66
117.93
47.75
14
Proceedings of Eurasia Business Research Conference
16 - 18 June 2014, Nippon Hotel, Istanbul, Turkey, ISBN: 978-1-922069-54-2
H
I
G
H
Portugal
Greece
Korea
New Zealand
Spain
Italy
France
Australia
Belgium
Germany
Canada
Netherlands
Austria
Finland
Singapore
Ireland
UK
Hong Kong
Sweden
Denmark
Iceland
USA
Switzerland
Norway
Japan
11 226
12 420
12 642
13 992
14 642
19 178
21 824
22 485
22 935
23 287
23 797
24 341
24 355
24 386
25 706
26 018
26 138
28 747
28 879
30 012
32 388
35 315
36 021
38 210
38 211
1.42
2.06
3.53
1.16
1.64
0.46
1.04
1.99
1.39
1.25
1.58
1.73
1.69
2.38
3.08
3.16
1.82
2.60
2.17
0.96
1.88
1.45
1.12
1.44
0.66
2.14
3.03
3.83
1.97
2.27
2.24
1.68
1.16
1.76
2.20
2.07
2.16
1.94
3.60
5.05
4.80
2.21
4.04
2.82
2.38
3.67
2.09
1.71
2.01
2.36
569
650
169
579
710
443
525
701
586
306
357
649
1428
421
1476
939
494
2079
650
629
1432
394
1201
546
80
2.51
4.03
3.89
0.74
1.15
-1.64
1.77
1.60
4.20
4.26
-0.37
1.41
1.07
2.50
0.76
3.00
-0.16
6.44
5.56
0.23
1.92
0.74
0.58
-1.30
8.10
7.37
19.10
22.67
8.92
6.00
5.65
9.51
8.85
13.44
7.05
7.94
6.38
3.71
5.85
19.08
4.62
4.19
17.47
8.44
8.16
10.09
8.06
5.67
5.44
19.96
5.06
5.18
1.36
4.12
4.86
2.32
2.40
3.15
2.53
1.31
1.51
2.68
5.87
1.73
5.79
3.64
1.91
6.95
2.21
2.09
4.42
1.12
3.34
1.44
0.21
7430
6928
9952
8250
8114
9758
11352
9045
33806
16375
17388
31399
22955
18512
99484
41603
14972
96578
24779
26226
25699
9081
30235
27535
9257
2.25
3.23
7.21
1.02
3.20
1.44
2.25
2.32
2.83
5.49
0.50
3.54
4.27
3.66
3.73
4.91
2.56
5.26
3.80
2.91
4.67
2.92
3.31
1.45
4.37
7.67
10.38
9.55
6.93
8.90
9.93
7.55
5.82
8.08
8.00
7.11
7.48
7.77
10.93
8.90
7.56
5.48
10.59
7.56
8.40
5.83
9.17
6.54
6.29
14.23
66.02
55.38
76.85
58.96
55.10
50.75
51.85
40.13
146.64
69.48
73.35
128.26
93.22
75.15
381.83
159.37
57.18
326.92
84.96
86.78
78.66
25.59
83.40
77.05
24.02
15
Proceedings of Eurasia Business Research Conference
16 - 18 June 2014, Nippon Hotel, Istanbul, Turkey, ISBN: 978-1-922069-54-2
Table 2
Estimation Results Using Level Variables for Two Groups of Income Level
Including logTRADE
Excluding logTRADE
Variable
LOW
MIDDLE/HIGH
LOW
MIDDLE/HIGH
0.020
0.053
0.020
0.053
(0.025)
(0.012)
(0.025)
(0.012)
1.509
1.295
1.534
1.359
(0.067)
(0.044)
(0.063)
(0.042)
-0.508
-0.303
-0.537
-0.364
(0.067)
(0.044)
(0.063)
(0.042)
0.018
0.003
0.020
0.018
(0.008)
(0.009)
(0.008)
(0.008)
-0.016
-0.003
-0.018
-0.016
(0.008)
(0.009)
(0.008)
(0.008)
0.021
0.071
(0.024)
(0.019)
-0.025
-0.066
(0.023)
(0.019)
Included
Included
Included
Included
Does leisure
tourism contribute
to economic
growth?a
Yes
(p = 0.088)
No
(p = 0.836)
Yes
(p = 0.043)
Yes
(p = 0.047)
No. of observations
196
532
196
532
No. of countries
14
38
14
38
Intercept
logGDPi,t-1
logGDPi,t-2
logTOURi,t-1
logTOURi,t-2
logTRADEi,t-1
logTRADEi,t-2
Year dummies
a
This question tests whether the coefficients for logTOURi,t-1 and logTOURi,t-2 are jointly significant.
Figures in parentheses are standard errors.
16
Proceedings of Eurasia Business Research Conference
16 - 18 June 2014, Nippon Hotel, Istanbul, Turkey, ISBN: 978-1-922069-54-2
Table 3
Estimation Results Using Change-rate Variables for Two Groups of Income Level
Including %ΔTRADE
Excluding %ΔTRADE
Variable
LOW
MIDDLE/HIGH
LOW
MIDDLE/HIGH
0.990
2.018
0.842
2.058
(0.800)
(0.390)
(0.789)
(0.394)
0.518
0.331
0.540
0.380
(0.065)
(0.044)
(0.062)
(0.042)
0.017
0.004
0.019
0.017
(0.008)
(0.009)
(0.008)
(0.008)
0.025
0.068
(0.023)
(0.019)
Included
Included
Included
Included
Does leisure
tourism contribute
to economic
growth?a
Yes
(p = 0.035)
No
(p = 0.652)
Yes
(p = 0.013)
Yes
(p = 0.041)
No. of observations
196
532
196
532
No. of countries
14
38
14
38
Intercept
%ΔGDPi,t-1
%ΔTOURi,t-1
%ΔTRADEi,t-1
Year dummies
a
This question tests whether the coefficient for %ΔTOURi,t-1 is significant.
Figures in parentheses are standard errors.
17