Abstract
This study aims to explore the effects of geopolitical risk on the Borsa İstanbul (BIST) tourism index and tourist arrivals. The effects of the geopolitical risk index on the BIST tourism index and tourist arrivals were analyzed based on the data between January 1998 and October 2020, and the findings were presented. Time series analysis methods were used in the study. To investigate the relationship between variables, it was first tested whether the series of variables are stationary or not. Then, Lee-Strazicich unit root test was applied, considering the structural breaks. Finally, the causality relationship between variables and the direction of this relationship was determined by the Hatemi-J causality test. According to the findings, there is an asymmetrical relationship between Turkey's geopolitical risks with BIST tourism index. The increase in Turkey's geopolitical risks, causes a significant decrease in tourism BIST returns. Likewise, when the risk decreases, BIST tourism returns increase. On the other hand, the reduction of geopolitical risk in Turkey causes an increase in tourist arrivals.
Highlights
Income flow from tourism activities is an important driver of economic growth, especially for developing countries
From the perspective of developing countries such as Turkey, tourism is a significant economic benefit created by the return in terms of these countries it is the fact that several risks in the host
This study examines the potential impacts of geopolitical risk which calculated for turkey to BIST tourism returns and foreign entries. it was investigated asymmetric causal relationship between the geopolitical risks and BIST tourism, foreign entries return
Summary
Income flow from tourism activities is an important driver of economic growth, especially for developing countries. From the perspective of developing countries such as Turkey, tourism is a significant economic benefit created by the return in terms of these countries it is the fact that several risks in the host. These risks, which are generally referred to as geopolitical risks, cause problems such as wars, terrorist incidents, tensions, risks related to ethnic and political violence, and a decrease in the flow of tourism to these regions by greatly affecting the socio-economic environment (Balli, Uddin, & Shahzad, 2019). When geopolitical risks increase in a country, tourists' concerns about their personal safety lead them to delay or cancel their travel plans (Demir, Simonyan, Chen, & Marco Lau, 2020)
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