How strong is the linkage between tourism and economic growth in Europe?

Antonakakis, N., Dragouni, M. and Filis, G., 2015. How strong is the linkage between tourism and economic growth in Europe? Economic Modelling, 44, 142 - 155 .

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EconMod_post-print.pdf - Submitted Version


DOI: 10.1016/j.econmod.2014.10.018


In this study, we examine the dynamic relationship between tourism growth and economic growth, using a newly introduced spillover index approach. Based on monthly data for 10 European countries over the period 1995{2012, our analysis reveals the following empirical regularities. First, the tourism-economic growth relationship is not stable over time in terms of both magnitude and direction, indicating that the tourism{led economic growth (TLEG) and the economic{driven tourism growth (EDTG) hypotheses are time{dependent. Second, the aforementioned relationship is also highly economic event{dependent, as it is influenced by the Great Recession of 2007 and the ongoing Eurozone debt crisis that began in 2010. Finally, the impact of these economic events is more pronounced in Cyprus,Greece, Portugal and Spain, which are the European countries that have witnessed the greatest economic downturn since 2009. Plausible explanations of these results are provided and policy implications are drawn.

Item Type:Article
Uncontrolled Keywords:Tourism led economic growth, Economic driven tourism growth, Spillover,Time varying relationship, Variance decomposition, Europe
Group:Business School
ID Code:21568
Deposited By: Unnamed user with email symplectic@symplectic
Deposited On:19 Nov 2014 11:11
Last Modified:19 Nov 2014 11:11


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