International tourism demand, number of airline seats and trade triangle: Evidence from New Zealand partners

Abstract

This article examines the three-way relationship between international tourism demand, airline economy seats and international trade for New Zealand together with its key trading/tourism partners. We have found that airline economy seats are the important factor for determining tourism demand among New Zealand's tourism partners except for richer economies, like the United States and Japan. Trade volume does not have strong causality relationship to tourism demand in particular for trading partners, like Japan, Korea, Singapore and the United States. However, especially after the global financial crisis, it is observed that trade volumes help to boost the number of airline economy seats available (airline seat capacity) between New Zealand and its trading partners.