Abstract
This study examines the effects of bank and stock market development on three tourism demand indicators: number of tourist arrivals, expenditure to gross domestic product ratio, and expenditure per arrival. We analyze annual data spanning the period 1995-2018 for a sample of 207 countries. The theoretical contribution of this study is threefold: first, we assess a variety of financial development indicators; second, we employ cross-sectionally augmented distributed lags estimator that produces estimates robust to the dependence structure in the data; third, using data on a wide assortment of countries, we generalize the findings of several country-specific case studies. We observe that financial development affects both tourist arrivals and tourism expenditure positively. However, the gains in tourist arrivals are more significant relative to those in tourism expenditure. Furthermore, we find the responsiveness of tourism demand to financial development to vary with the income level.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.