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Is tourism‐led growth hypothesis still valid?
Author(s) -
Mitra Subrata Kumar
Publication year - 2019
Publication title -
international journal of tourism research
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.155
H-Index - 58
eISSN - 1522-1970
pISSN - 1099-2340
DOI - 10.1002/jtr.2285
Subject(s) - tourism , econometrics , bivariate analysis , causality (physics) , economics , receipt , gross domestic product , macroeconomics , mathematics , statistics , geography , accounting , physics , archaeology , quantum mechanics
The purpose of the study is to re‐examine the direction of the causal relationship between tourism growth and economic progress. Although a vast literature on the topic is available, the results are still mixed and sample dependent. The study re‐examined the causal relationship using as many as 158 countries and classified them into three groups on the basis of the international tourism receipt relative to the gross domestic product (GDP). On methodological front, the study adopted the new panel causality model of Dumitrescu and Hurlin. Before carrying out the causality test, cross‐sectional dependence and homogeneity tests are implemented because the Dumitrescu and Hurlin test can take both cross‐sectional dependence and heterogeneity into account. The interesting outcome of the study is that the bivariate causal relationship has remained consistent across three subsamples when tourism growth is measured in terms of international tourism receipt and related to the GDP.