A Study on the Causality Relationship between Total Capital Increase, Foreign Investments, and Tourism Sector Revenues in Azerbaijan
Abstract
The causation link between foreign investments in Azerbaijan, the country's overall capital expansion, and the growth of the tourist industry is examined in this paper. The Granger technique was used to ascertain the causal connection. The World Bank provided the data set needed for the analytical step. The findings of the research conducted to ascertain the connection between total capital rises, foreign investments, and tourist revenues in Azerbaijan demonstrate that there is some causation. The study's findings indicate that in Azerbaijan, economic development and tourist revenue are related. In other words, as the economy develops, the tourist industry in this nation expands and generates more revenue. In addition, it is evident that the growth of the tourist industry in this nation is successful in luring foreign capital to this nation. The growth of the tourist industry has a direct impact on the rise in total capital rises, just as it does on luring foreign investment into the nation. In other words, the growth of the tourist industry is the primary driver of both domestic and international investments. It is acknowledged that causation exists in each of the three situations.
References
[1] Andergassen, R., and Candela, G. 2013. Less developed countries, tourism investments and local economic development. Review of Development Economics, 17(1): 16-33. DOI: https://doi.org/10.1111/rode.12012
[2] Banerjee, O., Cicowiez, M., and Gachot, S. 2015. A quantitative framework for assessing public investment in tourism. An application to Haiti. Tourism Management, 51: 157-173. DOI:https://doi.org/10.1016/j.tourman. 2015.05.015
[3] Bram, J. 1995. Tourism and New York City's Economy. Current Issues in Economics and Finance, 1(7): 1-6. DOI: http://dx.doi.org/10.2139/ssrn.1001259
[4] Chen, X. 2010. The influence of FDI on China’s tourism industry. Doctoral dissertation. Auckland University of Technology.
[5] Chou, M. C. 2013. Does tourism development promote economic growth in transition countries? A panel data analysis. Economic Modelling, 33: 226-232. DOI: https://doi.org/10.1016/j.econmod.2013.04.024
[6] Daly, M. T., Stimson, R.J., and Jenkins, O. 1996. Tourism and foreign investment in Australia: trends, prospects and policy implications. Australian Geographical Studies, 34(2): 169-184. DOI:https://doi.org/10.1111/j.1467-8470.1996.tb00114.x
[7] Du, D., Lew, A. A., and Ng, P.T. 2016. Tourism and economic growth. Journal of Travel Research, 55(4): 454-464. DOI: https://doi.org/10.1177/0047287514563167
[8] Dwyer, L., and Forsyth, P. 1994. Foreign tourism investment: Motivation and impact. Annals of Tourism Research, 21(3): 512-537. DOI: https://doi.org/10.1016/0160-7383(94)90118-X
[9] Edwards, A.D., and Cleverdon, R. 1982. International Tourism to 1990. Economist Intelligence Unit. Unit Special Series, 4. Cambridge.
[10] Haiying, Z. 2020. Egypt Tourism and Its Importance in Sustainable Development Goals. In 3rd International Conference on Social Transformation, Community and Sustainable Development (ICSTCSD 2019), pp. 202-205). Atlantis Press. DOI: https://doi.org/10.2991/icstcsd-19.2020.4
[11] Heese, K. 2000. Foreign direct investment in South Africa (1994-9)-confronting globalisation. Development Southern Africa, 17(3): 389-400. DOI: https://doi.org/10.1080/713661416
[12] Hof, A., and Blázquez-Salom, M. 2015. Changing tourism patterns, capital accumulation, and urban water consumption in Mallorca, Spain: A sustainability fix? Journal of Sustainable Tourism, 23(5): 770-796. DOI:https://doi.org/10.1080/09669582.2014.991397
[13] Holik, A. 2016. Relationship of economic growth with tourism sector. Jurnal Ekonomi dan Kebijakan, 9(1): 16-33. DOI: https://doi.org/10.15294/jejak.v9i1.7184
[14] Huseynli, B. 2021a. Müşteri deneyiminin oluşturulması ve yönetimi (Creating and Managing Customer Experience). In Özker, A.N. (Ed.), İşletme ve İktisadî Bilimler Araştırma ve Teori (Business and Economic Sciences: Research and Theory). pp. 269-289. Lyon: Livre de Lyon.
[15] Huseynli, B. 2021b. Fijital pazarlamanın müşteri deneyimindeki rolü (Role of phygital marketing in customer experience). In Çelebi, F. (Ed.), İşletme Biliminden Seçkin Araştırmalar (Distinguished Research from Business Science), pp. 52-83. İzmir: Duvar.
[16] Huseynli, B. 2022a. Examining the Relationship Between Brand Value, Energy Production and Economic Growth. International Journal of Energy Economics and Policy, 12(3): 298-304. DOI: https://doi.org/10.32479/ ijeep.12987
[17] Huseynli, N. 2022b. Causality Relationship between Foreign Investment and Tourism Sector Growth: Selected African Continent Countries. African Journal of Hospitality, Tourism and Leisure, 11(4): 1656-1667.
[18] Jakupova, D., Koshebayeva, G., Alpysbayeva, N. and Biryukov, V. 2022. Analysis of the Youth Policies and Its Impact on the Economic Policy of the State for the Tourism Development. Journal of Environmental Management and Tourism, 13(6): 1603-1615.
[19] Khoshnevis Yazdi, S., Nateghian, N., and Sheikh Rezaie, N. 2017. The causality relationships between tourism development and foreign direct investment: an empirical study in EU countries. Journal of Policy Research in Tourism, Leisure and Events, 9(3): 247-263. DOI:https://doi.org/10.1080/19407963.2017.1297310
[20] Nguyen, D.H., Khai, H.N. and Ngo, Q. V. 2022. The Influence of Tourist Experience on Local Product Purchase Behavior. Journal of Environmental Management and Tourism, 13(6): 1712-1727.
[21] Nowak, J. J., Sahli, M., Cortés-Jiménez, I. 2007. Tourism, capital goods imports and economic growth: theory and evidence for Spain. Tourism Economics, 13(4): 515-536. DOI:https://doi.org/10.5367/000000007782696113
[22] Rajapakse, C. R. 2016. The relationship between foreign direct investment and tourism development: evidence from Sri Lanka. International Journal of Research in Economics and Social Sciences, 6(5): 183-193.
[23] Rodríguez, C., Florido, C., and Jacob, M. 2020. Circular economy contributions to the tourism sector: A critical literature review. Sustainability, 12(11): 1-27. DOI: https://doi.org/10.3390/su12114338
[24] Samimi, A. J., Sadeghi, S., and Sadeghi, S. 2013. The relationship between foreign direct investment and tourism development: evidence from developing countries. Institutions and Economies, 5(2): 59-68.
[25] Sanford Jr, D. M., and Dong, H. 2000. Investment in familiar territory: Tourism and new foreign direct investment. Tourism Economics, 6(3): 205-219. DOI: https://doi.org/10.5367/000000000101297596
[26] Satrovic, E., and Muslija, A. 2018. Causality relationship between foreign direct investment and tourism. Uluslararası İktisadi ve İdari İncelemeler Dergisi, 22: 65-76. DOI: https://doi.org/10.18092/ulikidince.418132
[27] Schubert, S. F., and Brida, J. G. 2008. Dynamic effects of subsidizing the tourism sector. Tourism Economics, 14(1): 57-80. DOI: https://doi.org/10.5367/000000008783554767
[28] Selvanathan, S., Selvanathan, E. A., and Viswanathan, B. 2012. Causality between foreign direct investment and tourism: Empirical evidence from India. Tourism Analysis, 17(1): 91-98. DOI: https://doi.org/10.3727/ 108354212X13330406124296
[29] Shaw, C., and Ivens, J. 2002. Building Great Customer Experiences. London: Palgrave. ISBN: 978-0-230-55471-9. DOI: https://doi.org/10.1057/9780230554719
[30] Snyman, J. A., and Saayman, M. 2009. Key factors influencing foreign direct investment in the tourism industry in South Africa. Tourism Review, 64(3): 49-58. DOI: https://doi.org/10.1108/16605370910988827
[31] Solow, R.M. 1956. A contribution to the theory of economic growth. The Quarterly Journal of Economics, 70(1): 65-94. https://doi.org/10.2307/1884513
[32] Stauvermann, P. J., and Kumar, R. R. 2017. Productivity growth and income in the tourism sector: Role of tourism demand and human capital investment. Tourism Management, 61: 426-433. DOI:https://doi.org/10.1016/j. tourman.2017.03.006
[33] Suhud, U., Allan, M. and Gaffar, V. 2022. Antecedents of Tourists’ Intentions to Visit in the Context of Coffee Tourism. Journal of Environmental Management and Tourism, 13(2): 324-337.
[34] Tang, S., Selvanathan, E. A., and Selvanathan, S. 2007. The relationship between foreign direct investment and tourism: empirical evidence from China. Tourism Economics, 13(1): 25-39. DOI: https://doi.org/10.5367/ 000000007779784498
[35] Wang, M. 2009. Manufacturing FDI and economic growth: evidence from Asian economies. Applied Economics, 41(8): 991-1002. DOI: https://doi.org/10.1080/00036840601019059
[36] Willem te Velde, D., and Nair, S. 2006. Foreign direct investment, services trade negotiations and development: the case of tourism in the Caribbean. Development Policy Review, 24(4): 437-454. DOI:https://doi.org/10.1111/j.1467-7679.2006.00333.x
[37] World Tourism Organization 2021. Tourism in Azerbaijan. Available at: https://www.worlddata.info/asia/azerbaijan/ tourism.php
[2] Banerjee, O., Cicowiez, M., and Gachot, S. 2015. A quantitative framework for assessing public investment in tourism. An application to Haiti. Tourism Management, 51: 157-173. DOI:https://doi.org/10.1016/j.tourman. 2015.05.015
[3] Bram, J. 1995. Tourism and New York City's Economy. Current Issues in Economics and Finance, 1(7): 1-6. DOI: http://dx.doi.org/10.2139/ssrn.1001259
[4] Chen, X. 2010. The influence of FDI on China’s tourism industry. Doctoral dissertation. Auckland University of Technology.
[5] Chou, M. C. 2013. Does tourism development promote economic growth in transition countries? A panel data analysis. Economic Modelling, 33: 226-232. DOI: https://doi.org/10.1016/j.econmod.2013.04.024
[6] Daly, M. T., Stimson, R.J., and Jenkins, O. 1996. Tourism and foreign investment in Australia: trends, prospects and policy implications. Australian Geographical Studies, 34(2): 169-184. DOI:https://doi.org/10.1111/j.1467-8470.1996.tb00114.x
[7] Du, D., Lew, A. A., and Ng, P.T. 2016. Tourism and economic growth. Journal of Travel Research, 55(4): 454-464. DOI: https://doi.org/10.1177/0047287514563167
[8] Dwyer, L., and Forsyth, P. 1994. Foreign tourism investment: Motivation and impact. Annals of Tourism Research, 21(3): 512-537. DOI: https://doi.org/10.1016/0160-7383(94)90118-X
[9] Edwards, A.D., and Cleverdon, R. 1982. International Tourism to 1990. Economist Intelligence Unit. Unit Special Series, 4. Cambridge.
[10] Haiying, Z. 2020. Egypt Tourism and Its Importance in Sustainable Development Goals. In 3rd International Conference on Social Transformation, Community and Sustainable Development (ICSTCSD 2019), pp. 202-205). Atlantis Press. DOI: https://doi.org/10.2991/icstcsd-19.2020.4
[11] Heese, K. 2000. Foreign direct investment in South Africa (1994-9)-confronting globalisation. Development Southern Africa, 17(3): 389-400. DOI: https://doi.org/10.1080/713661416
[12] Hof, A., and Blázquez-Salom, M. 2015. Changing tourism patterns, capital accumulation, and urban water consumption in Mallorca, Spain: A sustainability fix? Journal of Sustainable Tourism, 23(5): 770-796. DOI:https://doi.org/10.1080/09669582.2014.991397
[13] Holik, A. 2016. Relationship of economic growth with tourism sector. Jurnal Ekonomi dan Kebijakan, 9(1): 16-33. DOI: https://doi.org/10.15294/jejak.v9i1.7184
[14] Huseynli, B. 2021a. Müşteri deneyiminin oluşturulması ve yönetimi (Creating and Managing Customer Experience). In Özker, A.N. (Ed.), İşletme ve İktisadî Bilimler Araştırma ve Teori (Business and Economic Sciences: Research and Theory). pp. 269-289. Lyon: Livre de Lyon.
[15] Huseynli, B. 2021b. Fijital pazarlamanın müşteri deneyimindeki rolü (Role of phygital marketing in customer experience). In Çelebi, F. (Ed.), İşletme Biliminden Seçkin Araştırmalar (Distinguished Research from Business Science), pp. 52-83. İzmir: Duvar.
[16] Huseynli, B. 2022a. Examining the Relationship Between Brand Value, Energy Production and Economic Growth. International Journal of Energy Economics and Policy, 12(3): 298-304. DOI: https://doi.org/10.32479/ ijeep.12987
[17] Huseynli, N. 2022b. Causality Relationship between Foreign Investment and Tourism Sector Growth: Selected African Continent Countries. African Journal of Hospitality, Tourism and Leisure, 11(4): 1656-1667.
[18] Jakupova, D., Koshebayeva, G., Alpysbayeva, N. and Biryukov, V. 2022. Analysis of the Youth Policies and Its Impact on the Economic Policy of the State for the Tourism Development. Journal of Environmental Management and Tourism, 13(6): 1603-1615.
[19] Khoshnevis Yazdi, S., Nateghian, N., and Sheikh Rezaie, N. 2017. The causality relationships between tourism development and foreign direct investment: an empirical study in EU countries. Journal of Policy Research in Tourism, Leisure and Events, 9(3): 247-263. DOI:https://doi.org/10.1080/19407963.2017.1297310
[20] Nguyen, D.H., Khai, H.N. and Ngo, Q. V. 2022. The Influence of Tourist Experience on Local Product Purchase Behavior. Journal of Environmental Management and Tourism, 13(6): 1712-1727.
[21] Nowak, J. J., Sahli, M., Cortés-Jiménez, I. 2007. Tourism, capital goods imports and economic growth: theory and evidence for Spain. Tourism Economics, 13(4): 515-536. DOI:https://doi.org/10.5367/000000007782696113
[22] Rajapakse, C. R. 2016. The relationship between foreign direct investment and tourism development: evidence from Sri Lanka. International Journal of Research in Economics and Social Sciences, 6(5): 183-193.
[23] Rodríguez, C., Florido, C., and Jacob, M. 2020. Circular economy contributions to the tourism sector: A critical literature review. Sustainability, 12(11): 1-27. DOI: https://doi.org/10.3390/su12114338
[24] Samimi, A. J., Sadeghi, S., and Sadeghi, S. 2013. The relationship between foreign direct investment and tourism development: evidence from developing countries. Institutions and Economies, 5(2): 59-68.
[25] Sanford Jr, D. M., and Dong, H. 2000. Investment in familiar territory: Tourism and new foreign direct investment. Tourism Economics, 6(3): 205-219. DOI: https://doi.org/10.5367/000000000101297596
[26] Satrovic, E., and Muslija, A. 2018. Causality relationship between foreign direct investment and tourism. Uluslararası İktisadi ve İdari İncelemeler Dergisi, 22: 65-76. DOI: https://doi.org/10.18092/ulikidince.418132
[27] Schubert, S. F., and Brida, J. G. 2008. Dynamic effects of subsidizing the tourism sector. Tourism Economics, 14(1): 57-80. DOI: https://doi.org/10.5367/000000008783554767
[28] Selvanathan, S., Selvanathan, E. A., and Viswanathan, B. 2012. Causality between foreign direct investment and tourism: Empirical evidence from India. Tourism Analysis, 17(1): 91-98. DOI: https://doi.org/10.3727/ 108354212X13330406124296
[29] Shaw, C., and Ivens, J. 2002. Building Great Customer Experiences. London: Palgrave. ISBN: 978-0-230-55471-9. DOI: https://doi.org/10.1057/9780230554719
[30] Snyman, J. A., and Saayman, M. 2009. Key factors influencing foreign direct investment in the tourism industry in South Africa. Tourism Review, 64(3): 49-58. DOI: https://doi.org/10.1108/16605370910988827
[31] Solow, R.M. 1956. A contribution to the theory of economic growth. The Quarterly Journal of Economics, 70(1): 65-94. https://doi.org/10.2307/1884513
[32] Stauvermann, P. J., and Kumar, R. R. 2017. Productivity growth and income in the tourism sector: Role of tourism demand and human capital investment. Tourism Management, 61: 426-433. DOI:https://doi.org/10.1016/j. tourman.2017.03.006
[33] Suhud, U., Allan, M. and Gaffar, V. 2022. Antecedents of Tourists’ Intentions to Visit in the Context of Coffee Tourism. Journal of Environmental Management and Tourism, 13(2): 324-337.
[34] Tang, S., Selvanathan, E. A., and Selvanathan, S. 2007. The relationship between foreign direct investment and tourism: empirical evidence from China. Tourism Economics, 13(1): 25-39. DOI: https://doi.org/10.5367/ 000000007779784498
[35] Wang, M. 2009. Manufacturing FDI and economic growth: evidence from Asian economies. Applied Economics, 41(8): 991-1002. DOI: https://doi.org/10.1080/00036840601019059
[36] Willem te Velde, D., and Nair, S. 2006. Foreign direct investment, services trade negotiations and development: the case of tourism in the Caribbean. Development Policy Review, 24(4): 437-454. DOI:https://doi.org/10.1111/j.1467-7679.2006.00333.x
[37] World Tourism Organization 2021. Tourism in Azerbaijan. Available at: https://www.worlddata.info/asia/azerbaijan/ tourism.php
Published
2023-03-31
How to Cite
HUSEYNLI, Nigar.
A Study on the Causality Relationship between Total Capital Increase, Foreign Investments, and Tourism Sector Revenues in Azerbaijan.
Journal of Environmental Management and Tourism, [S.l.], v. 14, n. 2, p. 469 - 476, mar. 2023.
ISSN 2068-7729.
Available at: <https://journals.aserspublishing.eu/jemt/article/view/7695>. Date accessed: 21 nov. 2024.
doi: https://doi.org/10.14505/jemt.14.2(66).16.
Section
Article
Copyright© 2024 The Author(s). Published by ASERS Publishing 2024. This is an open access article distributed under the terms of CC-BY 4.0 license.