Does Tourism Influence Economic Growth? A Dynamic Panel Data Approach

Abstract

On Average, tourism-specialized countries grow more than others. This is not consistent with the core of modern economic growth theory that suggests that economic growth is linked to sectors with high-tech intensity and large scale. In this paper, we use appropriate panel data methods to study the relationship between tourism and economic growth. In general we show that tourism is a positive determinant of economic growth both in a broad sample of countries and in a sample of poor countries. However, contrary to previous contributions, tourism is not more relevant in small countries than in a general sample.