Mayers, Sherry-Ann and Jackman, Mahalia (2011): Investigating the business cycle properties of tourist flows to Barbados. Published in: Journal of Public Sector Policy Analysis , Vol. Vol 5, (2011)
This is the latest version of this item.
Download (389kB) | Preview
This paper evaluates whether the tourism cycles of Barbados can be regarded as a direct consequence of business cycles of the UK, US, Canada and Barbados. The cyclical components of the series are extracted using the structural time series framework by Harvey, 1989, and the interrelations between the variables are evaluated using innovation accounting. The variance decompositions suggests that shocks to the source country business cycle series can explain up to 25 percent of the future variation of the Barbadian tourism cycle. Shocks to the Barbadian business cycle only seem to significantly affect the Canadian tourist cycle. This implies that for tourist arrivals from the US and UK are more influenced by economic developments in their respective home countries, rather than those of Barbados. Finally, Granger-causality tests indicate that past values of the source country business cycles can help better predict present values tourist arrivals to Barbados, while past values of the Barbadian cycle only Granger-cause the Canadian tourist cycle. An interesting observation is that there appears to be some delay in the reaction of the tourism cycle to the business cycles. Thus, policy makers should take advantage of the delay between the two cycles, and adopt some form of countercyclical policy to soften the impact of negative income shocks in the UK, US or Canada on the Barbadian economy.
|Item Type:||MPRA Paper|
|Original Title:||Investigating the business cycle properties of tourist flows to Barbados|
|Keywords:||Tourism, Business Cycle, Barbados|
|Subjects:||E - Macroeconomics and Monetary Economics > E3 - Prices, Business Fluctuations, and Cycles > E32 - Business Fluctuations ; Cycles
N - Economic History > N1 - Macroeconomics and Monetary Economics ; Industrial Structure ; Growth ; Fluctuations > N16 - Latin America ; Caribbean
L - Industrial Organization > L8 - Industry Studies: Services > L83 - Sports ; Gambling ; Restaurants ; Recreation ; Tourism
|Depositing User:||Mahalia Jackman|
|Date Deposited:||27. May 2012 22:34|
|Last Modified:||18. Feb 2013 17:25|
Cogley, T., & Nason, J. (1995). Effects of the Hodrick-Prescott Filter on Trend and Difference Stationary Time Series: Implications for Business Cycle Research. Journal of Economic Dynamics and Control, 19, 253-278.
Dalrymple, K., Downes, D., Greenidge, K., & Worell, D. (1997). Forecasting Tourism Demand In Barbados. Presented at the 17th Annual International Symposium on Forecasting.
Dritsakis, N. (2004). Tourism as a Long-run Economic Growth Factor: An Empirical Investigation for Greece Using Causality Analysis. Tourism Economics, 10(3), 305-316.
Durbarry, R. (2004). Tourism and Economic Growth: The Case of Mauritius. Tourism Economics, 10, 389-401.
Eugenio-Martin, J., Martin-Morales, N., & Sinclair, M. (2008). The Role of Economic Development in Tourism Demand. Tourism Economics, 14, 673-690.
Gonzalez, P., & Moral, P. (1996). Analysis of Tourism Trends in Spain. Annals of Tourism Research, 23(4), 739-754.
Gouveia, P., & Rodrigues, P. (2005). Dating and Synchronizing Tourism Growth Cycles. Tourism Economics, 11(4), 501-515.
Granger, C. (1969). Investigating Causal Relations by Econometric Methods and Cross-Spectral Methods. Econometrica, 34, 541-551.
Greenidge, K. (2001). Forecasting Tourism Demand: An STM Approach. Annals of Tourism Research, 28(1), 98-112.
Guizzardi, A., & Mazzocchi, M. (2010). Tourism demand for Italy and the Business Cycle. Tourism Management, 31, 367-377.
Harvey, A. (1989). Forecasting Structural Time Series Models and the Kalman Filter. Cambridge: Cambridge University Press.
Harvey, A., & Shephard, N. (1993). Structural Time Series Models. In G. Maddla, R. Roa, & H. Vinod, Handbook of Statistics, Vol. 11 (pp. 261-302). Elsevier Science.
Jackman, M. (2011). Revisiting the Tourism-Led Growth Hypothesis for Barbados: A Disaggregated Market Approach. Mimeo.
Kim, H., Chen, M., & Jan, S. (2006). Tourism Expansion and Economic Development: The Case of Taiwan. Tourism Management, 27(5), 925-933.
Lorde, T., Francis, B., & Drakes, L. (2011). Tourism Services Exports and Economic Growth in Barbados. The International Trade Journal, 25(2), 205-232.
Lorde, T., Lowe, S., & Francis, B. (2010). Do Tourism Recipts Contribute to the Sustainability of Current Account Deficits in Barbados? Central Bank of Barbados Working Papers.
Louca, C. (2006). Income and Expenditure in the Tourism Industry: Time Series Evidence from Cyprus. Tourism Economics, 12(4), 603-617.
Narayan, P. (2004). Economic Impact of Tourism on Fiji’s Economy: Empirical Evidence from the Computable General Equilibrium Model. Tourism Economics, 10, 419-433.
Oh, C. (2005). The Contribution of Tourism Development to Economic Growth in the Korean Economy. Tourism Management, 26, 39-44.
Song, H., & Witt, S. (2000). Tourism Demand Modeling and Forecasting - Modern Econometric Approaches. Oxford: Pergamon.
Song, H., Kim, J., & Yang, S. (2010). Confidence Intervals for Tourism Demand Elasticities. Annals of Tourism Research, 37(2), 377-396.
Worrell, D., Belgrave, A., Grosvenor, T., & Lescott, A. (2011). An Analysis of the Tourism Sector in Barbados. Economic Review, XXXVII(1), 49-78
Available Versions of this Item
Investigating the business cycle properties of tourist flows to Barbados. (deposited 07. May 2012 15:28)
- Investigating the business cycle properties of tourist flows to Barbados. (deposited 27. May 2012 22:34) [Currently Displayed]