Role of tourism development in environmental degradation: A step towards emission reduction

Abstract

Globally, the interaction and vulnerability of tourism and climate change have recently been in focus. This study examines how carbon dioxide emissions respond to changes in the tourism development. Panel data from 2000 to 2017 for 70 countries are analyzed using spatial econometric method to investigate the spatial spillover effect of tourism development on environmental pollution. The direct, indirect, and overall impact of tourism on environmental pollution are estimated after the selection of the most appropriate GNS method. The findings reveal that tourism has a positive direct effect and a negative indirect effect; both are significant at the 1 % level. The negative indirect effect of tourism is greater than its direct positive effect, implying an overall significantly negative impact. Further, the outcome of financial development and carbon emissions have an inverted U-shaped and U-shaped relationship in direct and indirect impacts. Population density, trade openness and economic growth significantly influence on environmental pollution through spatial spill over. In addition, education expenditure and infrastructure play a significant moderating role in the relationship among tourism development and environmental pollution. The results have important policy implications as they establish an inverted-U-shaped relationship among tourism and environmental pollution and indicate that while a country's emissions initially rise with the tourism industry's growth, they begin declining after a limit.