An Empirical Analysis of the Determinants of Tourism in Pakistan

Abstract

The aim of this study is to explore the determinants of tourism in Pakistan. However, the present study used secondary data for the period of 1995 to 2019 taken from the World Development Indicators, the World Bank database. In the empirical model, the dependent variable of the study is International tourist arrival and explanatory variables are economic growth, terrorism, trade, employment, and infrastructure. In addition, the study checked the data for stationarity using the Augmented Dickey-Fuller (ADF) test. For the long and short run association among the variables, the Autoregressive distributed lag model (ARDL) and bound test are employ. Therefore, the empirical results shows that there is positive relationship among the tourist arrival and infrastructure, international trade employment. Furthermore, economic growth and terrorism are inversely related with tourist arrival in long term and short run between the dependent and explanatory variables. These findings suggest that the government should try to focus on this side of the economy and promote tourism. And also, the government of Pakistan should try to take serious action on the safety issue and try to create the best peaceful environment for the visitors, so that are people feel secure and comfortable.