A Long-run Equilibrium Demand Function: Tourism in Mexico

Brida, Juan Gabriel and Risso, Wiston Adriàn and Carrera, Edgar J. Sanchez (2007): A Long-run Equilibrium Demand Function: Tourism in Mexico. Published in: TOURISMOS: An International Multidisciplinary Refereed Journal of Tourism , Vol. 3, No. 1 (15 April 2008): pp. 66-82.

Abstract

Tourism demand in Mexico is around 80 percent represented by USA visitors. The goal of this paper is to explain the long-term effects of Tourism Demand in Mexico with respect to US visitors. To reach our goal the methodology of this paper follows the Johansen cointegration analysis and using annual time-series data, a single equation is estimated. With the empirical analyze, we study the tourism demand elasticities considering public investment, relative prices of tourist products, and US income per capita. Further analysis shows only one direction of a strongly positive Granger-causality going from number of tourists to the relative prices. We show that US income positively affects the Mexican tourism demand.

• Item Type: MPRA Paper
• Language: English
• Keywords: Tourism demand modelling, Public investment on tourism, Economics of Tourism, Johansen Cointegration test
• Subjects: O - Economic Development, Innovation, Technological Change, and Growth > O1 - Economic Development; M - Business Administration and Business Economics ; Marketing ; Accounting ; Personnel Economics > M1 - Business Administration; L - Industrial Organization > L8 - Industry Studies: Services > L83 - Sports ; Gambling ; Restaurants ; Recreation ; Tourism

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