| By: |
Bichaka Fayissa;
Christian Nsiah;
Badassa Tadasse |
| Abstract: |
From 1995-2007, worldwide tourist arrivals increased about 68.2 percent (or an
average annual growth rate of about 5.2 percent) from 534 million to 898
million (UNWTO, 2008). Over the same period, Latin America countries (Central
and South America) have experienced a rise in tourist arrivals from 14.3
million to 27.9 million (about 49 % growth) and tourist receipts growth from
$2.3 billion to $3.7 billion (about 61 % growth), respectively. The tourism
industry in Latin American countries (LAC) has also experienced a sizable
increase in annual market share growth rate of 8.7 percent in 2004. Despite
this fact, there are only few empirical studies that investigate the
contributions of tourism to economic growth and development for Latin American
economies. Using a panel data of 17 Latin American countries for the years
that span from 1995 to 2004, this study investigates the impact of the tourism
industry on the economic growth and development Latin American countries
within the framework of the conventional neoclassical growth model. The
empirical results show that revenues from the tourism industry positively
contribute to both the current level of gross domestic product and the
economic growth of LACs as do investments in physical and human capital. Our
findings imply that Latin American economies may enhance their economic growth
by strategically strengthening the tourism industry while not neglecting the
other sectors which also promote growth. |
| Keywords: |
Tourism, Economic Growth, Latin American Countries, Dynamic Panel Data, Fixed Effects, Random Effects, Arellano-Bond Models |
| JEL: |
C33 F14 L83 O40 O54 |
| Date: |
2009–03 |
| URL: |
http://d.repec.org/n?u=RePEc:mts:wpaper:200902&r=tur |