Tourism Specialization, Absorptive Capacity and Economic Growth

Glauco De Vita, K. S. Kyaw

Research output: Contribution to journalArticle

39 Citations (Scopus)
68 Downloads (Pure)

Abstract

This paper investigates the relationship between tourism specialization and economic growth whilst accounting for the absorptive capacity of host (tourism destination) countries, defined in terms of financial system development. We use the system generalized methods-of-moments (SYS-GMM) estimation methodology to investigate this relationship for 129 countries over the period 1995-2011. The results support the hypothesis that the positive effect of tourism specialization on growth is contingent on the level of economic development as well as the financial system absorptive capacity of recipient economies. Consistent with the law of diminishing returns, we also find that for countries with a developed financial system, at exponential levels of tourism specialization its effect on growth turns negative. Significant policy implications flow from these findings.
Original languageEnglish
Pages (from-to)423-435
JournalJournal of Travel Research
Volume56
Issue number4
Early online date18 May 2016
DOIs
Publication statusPublished - 1 Apr 2017

Keywords

  • tourism specialization
  • absorptive capacity
  • economic growth
  • financial development
  • SYS-GMM

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