Abstract
In this study, the effects of tourism receipts on economic growth will be investigated econometrically for the top 20 countries earning most from international tourism (WTR-20) in the world for the period 1996-2016. From this aspect, this study aimed to empirically evaluate whether international tourism receipts have an effect on economic growth performances of the developed and developing countries in the WTR-20 group as proposed by theoretical literature under the tourism-led growth hypothesis. To determine the effects of international tourism receipts on economic growth for WTR-20 group countries, a model is an extended form of Cobb-Douglas type of production function, will be estimated under the secondgeneration panel data analysis considering cross-sectional dependence. As a result of the study, it is determined that international tourism revenues have a positive and statistically significant effect on economic growth in the WTR-20 group countries. Also, it is found that there was unilateral causality running from international tourism receipts to economic growth in the WTR-20 group countries. These findings, which are in keeping with the theoretical literature under the tourism-led growth hypothesis, indicate that international tourism receipts have a significant effect on providing economic growth and gaining sustainability in WTR-20 group countries with their current structures.
Highlights
In its most general form, tourism, defined as a whole of the economic and socio-cultural activities to generate income by the help of attracting tourists, is touristic travel to a country with the purpose of visiting, resting, having fun, and getting to know the country, and it states in the international services of the current account on the balance of payments (İTO, 2007, p. 13)
This study aimed to empirically evaluate whether international tourism receipts have an effect on economic growth performances of the developed and developing countries in the WTR-20 group as proposed by theoretical literature under the tourism-led growth hypothesis
This study is aimed at evaluating whether international tourism receipts have an effect on economic growth performances of WTR-20 countries, which is consistent of developed and developing countries as proposed by theoretical literature under the tourism-led growth hypothesis
Summary
In its most general form, tourism, defined as a whole of the economic and socio-cultural activities to generate income by the help of attracting tourists, is touristic travel to a country with the purpose of visiting, resting, having fun, and getting to know the country, and it states in the international services of the current account on the balance of payments (İTO, 2007, p. 13). In addition to direct income effects created by touristic consumption expenditures, expenditures for consumption and production of economic units, which acquire those touristic consumption expenditures as an income, run the multiplier mechanism by recirculation in an economy and lead to creating new incomes indirectly. In this context, tourism expenditures made by tourists in economies firstly create income effect as their magnitude, and some part of this existing income influences creating new incomes indirectly through its transferral to various forms such as investments, savings, consumption, taxes, etc. Thereby, consumption-income flow exists in the tourism sector as a result of the tourism movements, which constitute more extensive income effects regarding the initial expenditures on tourism and facilitate providing economic growth and rising development levels in economies because of the multiplier effect (Çeken, 2016, p. 130-131)
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