Impact of tourism revenues and inflation on economic growth: An empirical study on GUAM countries

Abstract

The aim of this study is to investigate the relationship between tourism income, consumer price index (CPI), and GDP per capita in Georgia, Ukraine, Azerbaijan, and Moldova (GUAM). The study covers annual data for the period 1995-2019. The method of long-run evaluation of the Pedroni cointegration coefficient was used as a research method. The results showed that, in general, growth in tourism revenues has a positive effect on GDP per capita, while the effect of CPI is negative. Along with this, it was found that the relationship of variables in the GUAM countries is different. In Georgia, there is a statistically significant long-run effect between GDP per capita, tourism income, and CPI. It is estimated that the growth of tourism income increases GDP per capita in all countries. However, the effect of the CPI on GDP per capita in Georgia and Azerbaijan is positive, but in Moldova and Ukraine, it is negative.