THE IMPACT OF INTERNATIONAL TOURISM ON TRADE AND ECONOMIC GROWTH: THE CASE OF UZBEKISTAN
Keywords:
International tourism, economic growth, International trade, Vector Error Correction Model (VECM), Granger causality, Tourism–trade complementarity.Abstract
This study empirically examines the dynamic relationships among international tourism, international trade, and economic growth in Uzbekistan over the period 1995–2023. Using annual data and applying the Johansen cointegration framework and Vector Error Correction Model (VECM), the research investigates whether international tourist arrivals exert long-run and shortrun effects on real GDP and trade volume. The analysis incorporates key macroeconomic variables, including gross capital formation, foreign direct investment, trade openness, and the real effective exchange rate. Unit root tests confirm that all variables are integrated of order one, I(1), allowing Johansen’s methodology to test for multiple cointegrating relationships. The results reveal at least one stable long-run cointegrating vector linking international tourism with both economic growth and trade. Long-run coefficients indicate that tourism significantly and positively influences GDP, with a 1% increase in tourist arrivals associated with approximately a 0.32% increase in real GDP. Tourism also exhibits a long-run positive impact on international trade, supporting the tourism–trade complementarity hypothesis. VECM short-run dynamics show that deviations from long-run equilibrium correct at a moderate speed, with the error correction term negative and statistically significant. Granger causality tests confirm bidirectional causality between tourism and GDP in the short run, while tourism unidirectionally causes trade in both the short and long run. Diagnostic testing confirms stability, normality, and absence of serial correlation. Overall, the findings suggest that international tourism acts as a strategic driver of economic development and trade expansion in Uzbekistan, supporting policies that enhance tourism infrastructure, liberalize travel regimes, and integrate tourism into the country’s export diversification strategy.
Downloads
References
1. Balaguer, J., & Cantavella-Jordá, M. (2002). Tourism as a long-run economic growth factor: The Spanish case. Applied Economics, 34(7), 877–884.
2. Brida, J. G., Cortes-Jimenez, I., & Pulina, M. (2016). Has the tourism-led growth hypothesis been validated? A literature review. Current Issues in Tourism, 19(5), 394–430.
3. Brida, J. G., & Risso, W. A. (2009). Tourism as a factor of long-run economic growth: An empirical analysis for Chile. European Journal of Tourism Research, 2(2), 178–185.
4. Christie, I., & Crompton, D. (2003). Republic of Rwanda: Tourism Policy and Strategy. World Bank.
5. Dritsakis, N. (2004). Tourism as a long-run economic growth factor: An empirical investigation for Greece. Tourism Economics, 10(3), 305–316.
6. Faye, M. L., McArthur, J. W., Sachs, J. D., & Snow, T. (2004). The challenges facing landlocked developing countries. Journal of Human Development, 5(1), 31–68.
7. Fischer, C., & Gil-Alana, L. A. (2009). The nature of the relationship between international tourism and international trade: The case of the U.S. Tourism Economics, 15(1), 171–186.
8. Gunduz, L., & Hatemi-J, A. (2005). Is the tourism-led growth hypothesis valid for Turkey? Applied Economics Letters, 12(8), 499–504.
9. Gurung, G., & De Coursey, M. (1994). Tourism and cultural ecology in Nepal. Studies in Nepalese History and Society, 4(1), 1–44.
10. Johansen, S. (1988). Statistical analysis of cointegration vectors. Journal of Economic Dynamics and Control, 12(2–3), 231–254.*
11. Johansen, S. (1991). Estimation and hypothesis testing of cointegration vectors in Gaussian vector autoregressive models. Econometrica, 59(6), 1551–1580.
12. Kim, H. J., Chen, M.-H., & Jang, S. S. (2006). Tourism expansion and economic development: The case of Taiwan. Tourism Management, 27(5), 925–933.
13. Kulendran, N., & Wilson, K. (2000). Modelling business travel. Tourism Economics, 6(1), 47–59.*
14. Lee, C.-C., & Chang, C.-P. (2008). Tourism development and economic growth: A closer look at panels. Tourism Management, 29(1), 180–192.
15. Narayan, P. K. (2004). Economic impact of tourism on Fiji’s economy: Empirical evidence from the computable general equilibrium model. Tourism Economics, 10(4), 419–433.*
16. Oh, C.-O. (2005). The contribution of tourism development to economic growth in the Korean economy. Tourism Management, 26(1), 39–44.
17. Payne, J. E., & Mervar, A. (2010). The tourism–growth nexus in Croatia. Tourism Economics, 16(4), 1089–1094.
18. Santana-Gallego, M., Ledesma-Rodríguez, F., & Pérez-Rodríguez, J. V. (2016). Tourism and trade in OECD countries. Annals of Tourism Research, 56, 1–15.
19. Sequeira, T. N., & Nunes, P. M. (2008). Does tourism influence economic growth? A dynamic panel data approach. Applied Economics, 40(18), 2431–2441.
20. UNWTO. (2023). World Tourism Barometer. United Nations World Tourism Organization.
21. Yameogo, N. D., et al. (2020). Tourism as a driver of economic growth in Africa: Empirical evidence. African Development Review, 32(Suppl. 1), S5–S17*.
22. Zhang, H., & Song, H. (2012). Tourism, trade and economic growth: Evidence from China. Tourism Economics, 18(4), 803–816.
Downloads
Published
Issue
Section
License
This work is licensed under a Creative Commons Attribution 4.0 International License.
License Terms of our Journal
