Toward efforts to lessen income inequality in Asia: Exploring synergies between tourism and governance quality

Abstract

While several studies have investigated the influence of tourism development on income inequality, the moderation of governance quality on the tourism-income inequality relationship remains scarce. Therefore, this study tries to fill the gap in the literature by examining the moderating effect of governance quality on the impact of tourism on income inequality in 30 Asian countries over the period 1996–2020. This study uses the dynamic ordinary least square (DOLS) and Panel corrected standard errors (PCSE) estimation techniques. The study unveils that the impact of tourism on income inequality is positive and statistically significant. However, the results show that the impact of governance quality on income inequality is negative and statistically significant. Importantly, the results show that the interaction term of tourism and governance quality has a negative and statistically significant effect on income inequality. Policy implications are discussed.