Share:


Tourism – economic growth nexus. The case of Romania

    Alina Badulescu   Affiliation
    ; Daniel Badulescu Affiliation
    ; Ramona Simut Affiliation
    ; Simona Dzitac Affiliation

Abstract

The development of tourism is usually associated, in positive terms, with economic development, foreign currency inflows, employment opportunities, infrastructure improvements, sustainable development and poverty alleviation. However, the nature of the tourism-growth relationship is still a matter of academic debate, and, perhaps, an expression of the inconsistencies and contradictions of public policies designed to support this industry. Researchers and practitioners have not yet come to an agreement on a number of fundamental questions: does tourism stimulate economic growth or the converse, and whether the causality, if it does exist, is uni or bidirectional, is constant or can change its direction in the medium - or long run. The present paper investigates the relationship between Gross Domestic Product (GDP) per capita and international tourism in Romania, over the 1995–2016 period. Our results show that the causal effect of the GDP on the international tourist arrivals and on the international tourism receipts is significant in the long run in Romania. In the short-run, we find a unidirectional causal relationship from the international tourism receipts to GDP, and a bidirectional causal relationship between GDP and the number of international tourist arrivals.


First published online 8 May 2020

Keyword : international tourism, economic growth, TLGH, GTLH Romania, Johansen cointegration test, Granger causality

How to Cite
Badulescu, A., Badulescu, D., Simut, R., & Dzitac, S. (2020). Tourism – economic growth nexus. The case of Romania. Technological and Economic Development of Economy, 26(4), 867-884. https://doi.org/10.3846/tede.2020.12532
Published in Issue
Jun 12, 2020
Abstract Views
2945
PDF Downloads
1556
Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

References

Akinboade, O., & Braimoh, L. (2010). International tourism and economic development in South Africa: A granger causality test. International Journal of Tourism Research, 12(2), 149–163. https://doi.org/10.1002/jtr.743

Andrei, T., & Bourbonnais, R. (2017). Econometrie. Editia a doua revazuta si adaugata. Economica.

Apergis, N., & Payne, J. (2012). Research note: Tourism and growth in the Caribbean-evidence from a panel error correction model. Tourism Economics, 18(2), 449–456 https://doi.org/10.5367/te.2012.0119

Arezki, R., Cherif, R., & Piotrowski, J. (2009). Tourism specialization and economic development: Evidence from the UNESCO World Heritage List (IMF WP/09/176). IMF Institute and Fiscal Affairs Department. https://doi.org/10.5089/9781451873238.001

Arslanturk, Y., & Atan, S. (2012). Dynamic relation between economic growth, foreign exchange and tourism incomes: an econometric perspective on Turkey. Journal of Business Economics & Finance, 1(1), 30–37.

Bac, D. P., & Aksoz, E. O. (2017). Contemporary challenges for sustainable tourism – a regional perspective. Oradea Journal of Business and Economics, 2(2), 37–44.

Badulescu, A., Simut, R., & Badulescu, D. (2018). The complex relationship between international tourism demand and economic growth: an analysis on Central and Eastern European economies. Amfiteatru Economic, 20(Special No. 12), 935–950. https://doi.org/10.24818/EA/2018/S12/935

Balaguer, J., & Cantavella-Jorda, M. (2002). Tourism as a long-run economic growth factor: the Spanish case. Applied Economics, 34(7), 877–884. https://doi.org/10.1080/00036840110058923

Bayramoğlu, T., & Arı, I. (2015). The relationship between tourism and economic growth in Greece economy: a time series analysis. Computational Methods in Social Sciences, 3(1), 89–93.

Bento, J. (2016). Tourism and economic growth in Portugal: an empirical investigation of causal links. Tourism & Management Studies, 12(1), 164–171. https://doi.org/10.18089/tms.2016.12117

Biji, E., Lilea, E., Vătui, M., & Roşca, E. (2015). Statistical analysis of the regional tourism development in the European Union. The USV Annals of Economics and Public Administration, 15(2(22)), 189–199.

Brida, J., Monterubbianesi, P., & Zapata-Aguirre, S. (2011). The impacts of tourism on economic growth and development: the case of the main Colombian destinations. PASOS: Revista de Turismo y Patrimonio Cultural, 9(2), 291–303.

Brida, J., Risso, W., & Bonapace, A. (2008, May 7–9). The contribution of tourism to economic growth: an empirical analysis for the case of Chile.In Sustainable Tourism as a Factor of Local Development, Monza, Italy. GRISS – Research Unit on Sustainable Development, University of Milano, Bicocca. http://ssrn.com/abstract=1298404

Caglayan, E., Sak, N., & Karymshakov, K. (2012). Relationship between tourism and economic growth: A panel granger causality approach. Asian Economic and Financial Review, 2(5), 518–529.

Cárdenas-García, P., Sánchez-Rivero, M., & Pulido-Fernández, J. (2015). Does tourism growth influence economic development?. Journal of Travel Research, 54(2), 206–221. https://doi.org/10.1177/0047287513514297

Chou, M. (2013). Does tourism development promote economic growth in transition countries? A panel data analysis. Economic Modelling, 33, 226–232. https://doi.org/10.1016/j.econmod.2013.04.024

Cortés-Jiménez, I., Pulina, M., Riera i Prunera, C., & Artis, M. (2009). Tourism and Exports as a means of Growth (IREA Working Papers 200910). University of Barcelona, Research Institute of Applied Economics.

Demiroz, D., & Ongan, S. (2005). The contribution of tourism to the long-run Turkish Economic Growth. Ekonomický časopis (Journal of Economics), 53(9), 880–894.

Dickey, D., & Fuller, W. (1979). Distribution of the estimators for autoregressive time series with a unit root. Journal of the American Statistical Association, 74(366), 427–431. https://doi.org/10.2307/2286348

Dogru, T., & Bulut, U. (2018). Is tourism an engine for economic recovery? Theory and empirical evidence. Tourism Management, 67, 425–434. https://doi.org/10.1016/j.tourman.2017.06.014

Dritsakis, N. (2004). Tourism as a long-run economic growth factor: An empirical investigation for Greece using causality analysis. Tourism Economics, 10(3), 305–316. https://doi.org/10.5367/0000000041895094

Durbarry, R. (2004). Tourism and economic growth: The case of Mauritius. Tourism Economics, 10(4), 389–401. https://doi.org/10.5367/0000000042430962

Eeckels, B. (2012). Tourism income and economic growth in Greece: empirical evidence from their cyclical components. Tourism Economics, 18(4), 817–834. https://doi.org/10.5367/te.2012.0148

Enders, W. (2014). Applied econometric time series (4 ed.). Wiley.

Engle, R., &, Granger, C. (1987). Co-integration and error correction: representation, estimation and testing. Econometrica, 55(2), 251–276. https://doi.org/10.2307/1913236

Fahimi, A., Akadiri, S., Seraj, M., & Akadiri, A. (2018). Testing the role of tourism and human capital development in economic growth. A panel causality study of micro states. Tourism Management Perspectives, 28, 62–70. https://doi.org/10.1016/j.tmp.2018.08.004

Granger, C. (1981). Some properties of time series data and their use in econometric model specification. Journal of Econometrics, 16, 121–130. https://doi.org/10.1016/0304-4076(81)90079-8

Greene, W. H. (2011). Econométrie (7 ed.). Pearson Education France.

Gwenhure, Y., & Odhiambo, N. (2017). Tourism and economic growth: A review of international literature. Tourism: An International Interdisciplinary Journal, 65(1), 33–44.

Hye, Q., & Khan, R. (2013). Tourism-led Growth hypothesis: a case study of Pakistan. Asia Pacific Journal of Tourism Research, 18(4), 303–313. https://doi.org/10.1080/10941665.2012.658412

Jalil, A., Mahmood, T., & Idrees, M. (2013). Tourism–Growth nexus in Pakistan: Evidence from ARDL bounds tests. Economic Modelling, 35(C), 185–191. https://doi.org/10.1016/j.econmod.2013.06.034

Johansen, S. (1988). Statistical analysis of cointegrating vectors. Journal of Economic Dynamics and Control, 12, 231–254. https://doi.org/10.1016/0165-1889(88)90041-3

Johansen, S. (1991). Estimation and hypothesis testing of cointegration vectors in gaussian vector autoregressive models. Econometrica, 59(6), 1551–1580. https://doi.org/10.2307/2938278

Johansen, S., & Juselius, K. (1990). Maximum likelihood estimation and inference on cointegration – with application to the demand for money. Oxford Bulletin of Economics and Statistics, 52, 169–210. https://doi.org/10.1111/j.1468-0084.1990.mp52002003.x

Kasimati, E. (2011). Economic impact of tourism on Greece’s economy: Cointegration and causality analysis. International Research Journal of Finance and Economics, 79, 79–85.

Katircioglu, S. (2009a). Tourism, trade and growth: The case of Cyprus. Applied Economics, 41(21), 2741–2750. https://doi.org/10.1080/00036840701335512

Katircioglu, S. (2009b). Revising the tourism-led-growth hypothesis for Turkey using the bounds test and Johansen approach for cointegration. Tourism Management, 30(1), 17–20. https://doi.org/10.1016/j.tourman.2008.04.004

Kibara, O., Odhiambo, N., & Njuguna, J. (2012). Tourism and economic growth in Kenya: An empirical investigation. International Business & Economics Research Journal (IBER), 11(5), 517–528. https://doi.org/10.19030/iber.v11i5.6970

Kim, H., Chen, M., & Jang, S. (2006). Tourism expansion and economic development: The case of Taiwan. Tourism Management, 27(5), 925–933. https://doi.org/10.1016/j.tourman.2005.05.011

Lanza, A., & Pigliaru, F. (2000). Why are tourism countries small and fast-growing?. In A. Fossati & G. Panella, (Eds.), Tourism and sustainable economic development (pp. 57–69). Kluwer Academic Publishers. https://doi.org/10.1007/978-1-4615-4321-3_3

Lee, C. C., & Chang, C. P. (2008). Tourism development and economic growth: A closer look at panels. Tourism Management, 29(1), 180–192. https://doi.org/10.1016/j.tourman.2007.02.013

Lee, C. C., & Chien, M. S. (2008). Structural breaks, tourism development, and economic growth: Evidence from Taiwan. Mathematics and Computers in Simulation, 77(4), 358–368. https://doi.org/10.1016/j.matcom.2007.03.004

MacKinnon, J. G., Haug, A. A., & Michelis, L. (1999). Numerical distribution functions of likelihood ratio tests for cointegration. Journal of Applied Econometrics, 14, 563–577. https://doi.org/10.1002/(SICI)1099-1255(199909/10)14:5<563::AID-JAE530>3.0.CO;2-R

Martins, L., Gan, Y., & Ferreira-Lopes, A. (2017). An empirical analysis of the influence of macroeconomic determinants on world tourism demand. Tourism Management, 61, 248–260. https://doi.org/10.1016/j.tourman.2017.01.008

Mathieson, A., & Wall, G. (1982). Tourism: Economic, physical, and social impacts. Longman.

Mazilu, M., Dumitrescu, D., Marinescu, R., & Baltălungă, A. (2018). New trends in Romanian tourism in 2018. Journal of Tourism & Hospitality, 7(4), 1–6. https://doi.org/10.4172/2167-0269.1000372

Mester, I., Badulescu, D., Badulescu, A., Bac, D .P., Simut, R., & Sehleanu, M. (2016). Attitudes and practices concerning sustainability. A research case on Romanian tourism ventures. Journal of Environmental Protection and Ecology, 17(2), 687–695.

Mishra, P., Rout, H., & Mohapatra, S. (2011). Causality between tourism and economic growth: Empirical evidence from India. European Journal of Social Sciences, 18(4), 518–527. https://doi.org/10.1353/jda.2017.0037

Oh, C. O. (2005). The contribution of tourism development to economic growth in the Korean economy. Tourism Management, 26(1), 39–44. https://doi.org/10.1016/j.tourman.2003.09.014

Ozturk, I., & Acaravci, A. (2009). On the causality between tourism growth and economic growth: Empirical evidence from Turkey. Transylvanian Review of Administrative Sciences, 25(E), 73–81.

Payne, J., & Mervar, A. (2010). Research note: The tourism–growth nexus in Croatia. Tourism Economics, 16(4), 1089–1094. https://doi.org/10.5367/te.2010.0014

Postelnicu, C., & Dabija, D. C. (2018). Romanian tourism: Past, Present and future in the context of globalization. Ecoforum, 7(1(14)).

Rivera, M. A. (2017). The synergies between human development, economic growth, and tourism within a developing country: An empirical model for Ecuador. Journal of Destination Marketing & Management, 6(3), 221–232. https://doi.org/10.1016/j.jdmm.2016.04.002

Sanchez Carrera, E., Risso, W., & Brida, J. (2008). Tourism’s Impact on long-run Mexican economic growth. Economics Bulletin, 3(21), 1–8. https://doi.org/10.2139/ssrn.1076225

Sánchez-Rivero, M., Pulido-Fernández, J., & Cárdenas-García, P. (2013). Tourism growth versus economic development: An analysis by multivariate techniques. In A. Matías (Ed.), Quantitative methods in tourism economics (pp. 235–251). Physica Verlag. https://doi.org/10.1007/978-3-7908-2879-5_13

Schubert, S., Brida, J., & Risso, W. (2011). The impacts of international tourism demand on economic growth of small economies dependent on tourism. Tourism Management, 32, 377–385. https://doi.org/10.1016/j.tourman.2010.03.007

Sehleanu, M. (2019). Analysis of foreign participation in the share capital of companies from the counties of North-West region of Romania. Oradea Journal of Business and Economics, 4(1), 7–16.

Sequeira, T., & Nunes, P. (2008). Does tourism influence economic growth? A dynamic panel data approach. Applied Economics, 40(18), 2431–2441. https://doi.org/10.1080/00036840600949520

Škrabić Perić, B., & Vidović, Ž. (2017). Heterogeneous panel granger causality between GDP and tourism in 11 EU members in Central and Southeastern Europe. Eastern European Business and Economics Journal, 3(1), 6–27.

Surugiu, C., Frent, C., & Surugiu, M. (2009). Tourism and its impact upon the Romanian economy: An input-output approach. Analele Stiintifice ale Universitatii „Alexandru Ioan Cuza” din Iasi, Stiinte Economice, LVI, 355–376.

Surugiu, C., & Surugiu, M.-R. (2013). Is the tourism sector supportive of economic growth? Empirical evidence on Romanian tourism. Tourism Economics, 19(1), 115–132. https://doi.org/10.5367/te.2013.0196

Surugiu, C., & Surugiu, M. R. (2015). Tourism as backer for regional development. A real deal or just another hope?. EuroEconomica, 34(1).

Tang, C., & Jang, S. (2009). The tourism-economy causality in the United States: A sub-industry level examination. Tourism Management, 30(4), 553–558. https://doi.org/10.1016/j.tourman.2008.09.009

Tang, C., & Tan, E. (2015). Does tourism effectively stimulate Malaysia’s economic growth?. Tourism Management, 46, 158–163. https://doi.org/10.1016/j.tourman.2014.06.020

Tugcu, C. (2014). Tourism and economic growth nexus revisited: A panel causality analysis for the case of the Mediterranean region. Tourism Management, 42(C), 207–212. https://doi.org/10.1016/j.tourman.2013.12.007

The World Bank. (2017). World Development Indicators, 1995–2016. Retrieved February 10, 2018, from http://databank.worldbank.org/data/indicator/NY.GDP.MKTP.KD.ZG/1ff4a498/Popular-Indicators

Watkins, M., Ziyadin, S., Imatayeva, A., Kurmangalieva, A., Blembayeva, A. (2018), Digital tourism as a key factor in the development of the economy, Economic Annals-XXI, 169(1–2), 40–45. https://doi.org/10.21003/ea.V169-08

World Tourism Organization. (2018). UNWTO Annual Report 2017. UNWTO, Madrid.

World Travel & Tourism Council. (2012). The comparative economic impact of travel & tourism. London.

World Travel & Tourism Council. (2018). Travel & tourism economic impact 2018. Romania. London.

World Travel & Tourism Council. (2019). WTTC Economic Impact Research 2019. Retrieved May 06, 2019, from https://www.wttc.org/

Zaman, G., Vasile, V., Surugiu, M. R., & Surugiu, C. (2010). Tourism and economic development in Romania: input-output analysis perspective. Romanian Journal of Economics, 32(2(40)), 5–37.