Effect of tourism on economic growth of Sri Lanka: accounting for capital per worker, exchange rate and structural breaks

Stauvermann, Peter J., Kumar, Ronald Ravinesh ORCID: 0000-0001-9658-4896, Shahzad, Syed Jawad Hussain and Kumar, Nikeel (2016) Effect of tourism on economic growth of Sri Lanka: accounting for capital per worker, exchange rate and structural breaks. Economic Change and Restructuring, 51 (1). pp. 49-68. ISSN 1573-9414

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Official URL: https://link.springer.com/article/10.1007/s10644-0...

Abstract

We explore the nexus between tourism, exchange rate and economic growth in Sri Lanka over the period 1980–2014. Using the augmented Solow (Q J Econ 70(1):65–94, 1956) framework and the ARDL bounds procedure whilst accounting for structural breaks using Bai and Perron (J Appl Econ 18(1):1–22, 2003) multiple break tests, the short-run and long-run association and impacts are examined. The results confirm the presence of a long-run association between tourism receipts (% of GDP), exchange rate, capital per worker and output per worker. The regression results show a 1% increase in tourism receipts results in a 0.03 and 0.06% increase in output per worker in the short-run and long-run, respectively. A unidirectional causality is noted from tourism to output per worker; from exchange rate to output per worker and capital per worker; and from output to capital, in per worker terms. Finally, we note that although structural breaks periods have negative association with economic growth, they are not statistically significant.

Item Type: Article
Additional Information: Full text this article is not available in this repository.
Uncontrolled Keywords: tourism; economic growth; elasticity; cointegration; casuality; structural breaks; Sri Lanka
Subjects: H Social Sciences > HB Economic Theory
Divisions: Faculty of Professional Studies > Bolton Business School > Bolton Business School
Depositing User: Sarah Taylor
Date Deposited: 20 Dec 2016 11:25
Last Modified: 25 May 2018 13:58
Identification Number: 10.1007/s10644-016-9198-6
URI: http://ubir.bolton.ac.uk/id/eprint/1030

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