International Tourism, Financial Deepening and Economic Growth: Insights from Southern African Countries
Abstract
The impact of tourism development on financial development via its effects on economic growth and country openness in Southern African countries for the period 1995 to 2019 was examined relying on pooled mean group-based estimation of panel ARDL regression, and the results lend supports to the tourism-led financial development hypothesis in these countries in the long-run. The findings infer that the development of the travel and tourism sector can spur financial development as the former by contributing to output, employment and income warrant an enhanced role of the financial sector.
References
References
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[33] Musakwa, M. T. and Odhiambo, N. M. 2021. Tourism and financial development nexus in Kenya: A multivariate approach. Journal of Transnational Management, 26(1): 58-74. DOI:https://doi.org/10.1080/15475778.2021.1880879
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[1] Al-Mulali, U., Solarin, S. A. and Gholipour, H. F. 2020. Relationship between financial development and inbound tourism: A revisit. Journal of Public Affairs, e2233. DOI: https://doi.org/10.1002/pa.2233
[2] Arslanturk Y, Balcilar, M. and Ozdemir, Z. A. 2011. Time-varying linkages between tourism receipts and economic growth in a small open economy. Economic Modelling, 28: 664-671. DOI:https://doi.org/10.1016/j.econmod.2010.06.003
[3] Aslan, A. 2016. Does tourism cause growth? Evidence from Turkey. Current Issues in Tourism, 19: 1176e1184. DOI: https://doi.org/10.1080/13683500.2015.1015970
[4] Cannonier, C. and Burke, M. G. 2017. Tourism and financial development in small states: evidence from Caribbean countries. Tourism Economics, 23: 1-9. DOI: https://doi.org/10.1177/1354816617689870
[5] Cardenas-Garci, P. J., Sanchez-Rivero, M. and Pulido-Fernandez, J. I. 2015. Does tourism growth influence economic development? Journal of Travel Research, 54: 206e221. DOI:https://doi.org/10.1177/0047287513514297
[6] Cernat, L. and Gourdon, J. 2012. Paths to success: Benchmarking cross-country sustainable tourism. Tourism Management, 33: 1044-1056. DOI: https://doi.org/10.1016/j.tourman.2011.12.007
[7] Chao, C., Hazari, B. R., Laffargue, J. P., and Yu, E. S. H. 2009. A dynamic model of tourism, employment and welfare: the case of Hong Kong. Pacific Economic Review. 14(2). 232-245. DOI:https://doi.org/10.1111/j.1468-0106.2009.00441.x
[8] Chao, C., Hazari, B. R., Laffargue, J. P., Sgro, P. M., & Yu, E. S. H. 2006. Tourism, Dutch disease and welfare in an open dynamic economy. The Japanese Economic Review. 57(4): 501-515. DOI:https://doi.org/10.1111/j.1468-5876.2006.00400.x
[9] Chen, C.-F., and Chiou-Wei, S. Z. 2009. Tourism expansion, tourism uncertainty and economic growth: New evidence from Taiwan and Korea. Tourism Management, 30: 812e818. DOI:https://doi.org/10.1016/j.tourman.2008.12.013
[10] Croes, R. 2006. A paradigm shift to a new strategy for small island economies: Embracing demand-side economics for value enhancement and long term economic stability. Tourism Management, 27: 453-465. DOI: https://doi.org/10.1016/j.tourman.2004.12.003
[11] Demetriades, P. and Law, S. H. 2006. Finance, Institutions and Economic Growth. International Journal of Finance and Economics, 11(3): 245-260. DOI: https://doi.org/10.1002/ijfe.296
[12] Gujarati, D. N., Porter, D. C. and Gunasekar, S. 2017. Basic Econometrics, 5th ed., McGraw Hill Education.
[13] Hausman, J. A. 1978. Specification Tests in Econometrics. Econometrica, 46: 1251-1272. DOI:https://doi.org/10.2307/1913827
[14] Im, K. S., Pesaran, M. H. and Shin, Y. 2003. Testing for unit roots in heterogeneous panels. Journal of Econometrics, 115(1): 53-74. DOI: https://doi.org/10.1016/S0304-4076(03)00092-7
[15] Katircioglu, S. T. 2009. Revisiting the tourism-led-growth hypothesis for Turkey using the bounds test and Johansen approach for cointegration. Tourism Management, 30(1): 17-20. DOI:https://doi.org/10.1016/j.tourman.2008.04.004
[16] Katircioglu, S., Katircioğlu, S. and Altinay, M. 2018. Interactions between tourism and financial sector development: evidence from Turkey. The Service Industries Journal, 38(9-10): 519-542. DOI:https://doi.org/10.1080/02642069.2017.1406479
[17] Khan, A., et al. 2020. Tourism and development in developing economies: a policy implication perspective. Sustainability, 12: 1618. DOI: httpS://doi.org/10.3390/su12041618
[18] Khanal, A., Rahman, M. M., Khanam, R. and Velayutham, E. 2022. The role of tourism in service sector employment: Do market capital, financial development and trade also play a role? PLoS ONE 17(8): e0270772. DOI: https://doi.org/10.1371/journal.pone.0270772
[19] Khanna, R., and Sharma, C. 2021. Does Financial Development Raise Tourism Demand? A Cross-Country Panel Evidence. Journal of Hospitality & Tourism Research. DOI:https://doi.org/10.1177/10963480211060789
[20] Kim, H. J., Chen, M. H. and Jang, S. C. 2006. Tourism expansion and economic development: the case of Taiwan. Tourism Management. 27: 925-933. DOI: https://doi.org/10.1016/j.tourman.2005.05.011
[21] Kumar, N. N., Chandra, R. A. and Patel, A. 2023. Modeling the tourism-financial development association in developing countries. Journal of Policy Research in Tourism, Leisure and Events. DOI:https://doi.org/10.1080/19407963.2023.2179061
[22] Kumar, R. R. 2014. Exploring the role of technology, tourism and financial development: an empirical study of Vietnam”. Quality and Quantity, 48(5): 2881-2898. DOI: https://doi.org/10.1007/s11135-013-9930-5
[23] Lee, C. and Kwon, K. 1995. Importance of secondary impact of foreign tourism receipts on the South Korean economy. Journal of Travel Research, 34: 50-54. DOI: https://doi.org/10.1177/004728759503400210
[24] Lee, C. C., and Chang, C. P. 2008. Tourism development and economic growth: A closer look at panels. Tourism Management, 29: 180-192. DOI: https://doi.org/10.1016/j.tourman.2007.02.013
[25] Lemmetyinen, A., and Go, F. M. 2009. The key capabilities required for managing tourism business networks. Tourism Management, 30: 31-40. DOI: https://doi.org/10.1016/j.tourman.2008.04.005
[26] Levine, R. 2003. More on finance and growth: more finance, more growth? Review, Federal Reserve Bank of Saint Louis, 85(4): 31-46. DOI: https://doi.org/10.20955/r.85.31-46
[27] Li, K. X., Jin, M., and Shi, W. 2018. Tourism as an important impetus to promoting economic growth: A critical review. Tourism Management Perspectives, 26: 135-142. DOI:https://doi.org/10.1016/j.tmp.2017.10.002
[28] McKinnon, D. R. I. 1964. Foreign exchange constraint in economic development and efficient aid allocation. Economic Journal, 74(3): 88-409. DOI: https://doi.org/10.2307/2228486
[29] Mishra, P. K., Rout, H. B. and Kestwal, A. K. 2020. Tourism, Foreign Direct Investment and Economic Growth in India. African Journal of Hospitality, Tourism and Leisure, 9(1): 1-7. Available at: https://www.ajhtl.com/uploads/7/1/6/3/7163688/article_62_vol_9_1__2020_india.pdf
[30] Mishra, P. K., Rout, H. B. and Sahoo, D. 2021. International Tourism and Economic Growth: Empirical Evidence from BRICS Countries. African Journal of Hospitality, Tourism and Leisure, 10(6): 1944-1958. DOI:https://doi.org/10.46222/ajhtl.19770720.202
[31] Mishra, P. K., et al. 2022. Does Tourism Foster Economic Growth in BRICS Region? Empirical Evidence Over 1995-2019. Journal of Environmental Management and Tourism, 4(60): 1089-1099. DOI:https://doi.org/10.14505/jemt.13.4(60).15
[32] Musakwa, M. T. and Odhiambo, N. M. 2020. Tourism and financial development in South Africa: a trivariate approach. Journal of Policy Research in Tourism, Leisure and Events. DOI:https://doi.org/10.1080/19407963.2020.1856860
[33] Musakwa, M. T. and Odhiambo, N. M. 2021. Tourism and financial development nexus in Kenya: A multivariate approach. Journal of Transnational Management, 26(1): 58-74. DOI:https://doi.org/10.1080/15475778.2021.1880879
[34] Ohlan, R. 2017. The Relationship between Tourism, Financial Development and Economic Growth in India. Future Business Journal, 3(1): 9-22. DOI: https://doi.org/10.1016/j.fbj.2017.01.003
[35] Pesaran, M. H. 2004. General diagnostic tests for cross section dependence in panels”, (Cambridge Working Papers in Economics No. 0435). Cambridge, UK: University of Cambridge. (2004). DOI:https://doi.org/10.2139/ssrn.572504
[36] Pesaran, M. H., and Smith, R. 1995. Estimating long-run relationships from dynamic heterogeneous panels. Journal of Econometrics, 68(1): 79-113. DOI: https://doi.org/10.1016/0304-4076(94)01644-F
[37] Pesaran, M. H., Shin, Y., and Smith, R. P. 1999. Pooled mean group estimation of dynamic heterogeneous panels. Journal of the American Statistical Association, 94(446): 621-634. DOI:https://doi.org/10.1080/01621459.1999.10474156
[38] Ridderstaat, J., Croes, R., and Nijkamp, P. 2014. Tourism and long-run economic growth in Aruba. International Journal of Tourism Research, 16: 472e487. DOI: https://doi.org/10.1002/jtr.1941
[39] Shahbaz, M. 2009. A reassessment of finance-growth nexus for Pakistan: under the investigation of FMOLS and DOLS techniques. The IUP Journal of Applied Economics, 8(1): 65-80.
[40] Shahbaz, M., Benkraiem, R., Miloudi, A. and Tiwari, A. K. 2018. Tourism-induced financial development in Malaysia: New evidence from the tourism development index. Tourism Economics, 1-22. DOI:https://doi.org/10.1177/1354816618806123
[41] Shahbaz, M., Kumar, R. R., Ivanov, S., and Loganathan, N. 2017. The nexus between tourism demand and output per capita with the relative importance of trade openness and financial development: A study of Malaysia. Tourism Economics, 23(1): 168-186. DOI: https://doi.org/10.5367/te.2015.0505
[42] Shahzad, S. J. H., Shahbaz, N., Ferrer, R. and Kumar, R. R. 2017. Tourism-led growth hypothesis in the top ten tourist destinations: New evidence using the quantile-on-quantile approach. Tourism Management, 60: 223-232. DOI: http://dx.doi.org/10.1016/j.tourman.2016.12.006
[43] Song, H., Li, G., Witt, S. F., and Fei, B. 2010. Tourism demand modelling and forecasting: How should demand be measured? Tourism Economics, 16: 63e81. DOI: https://doi.org/10.5367/000000010790872213
[44] Tang, C. F. and Abosedra, S. 2016. Tourism and growth in Lebanon: new evidence from bootstrap simulation and rolling causality approaches. Empirical Economics, 50(2): 679-696. DOI:https://doi.org/10.1007/s00181-015-0944-9
[45] Tsaurai, K. 2022. Is Financial Development a Determinant of Tourism? A Case of Selected Emerging Markets. Acta Universitatis Danubius. OEconomica, 18(4): 80-99. Available at: https://dj.univ-danubius.ro/index.php/AUDOE/article/view/1923/2200
[46] Tsaurai, K. 2018. The role of financial sector development in the tourism-growth nexus: A case of Southern African Countries. Journal of Economics and Behavioural Studies, 10(3): 100-110. DOI:http://doi.org/10.22610/jebs.v10i3.2320
[47] Weinhold, D. 1999. A Dynamic Fixed Effects Model for Heterogeneous Panel Data. London School of Economics. Mimeo, London.
[48] *** OECD. “OECD Tourism Trends and Policies 2018”, OECD Publishing, Paris. (2018). DOI: https://doi.org/10.1787/tour-2018-en
Published
2023-06-26
How to Cite
MISHRA, P. K. et al.
International Tourism, Financial Deepening and Economic Growth: Insights from Southern African Countries.
Theoretical and Practical Research in Economic Fields, [S.l.], v. 14, n. 1, p. 74 - 84, june 2023.
ISSN 2068-7710.
Available at: <https://journals.aserspublishing.eu/tpref/article/view/7864>. Date accessed: 22 dec. 2024.
doi: https://doi.org/10.14505/tpref.v14.1(27).07.
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