Investigating the Influence of International Tourism in Pakistan and Its Linkage to Economic Growth: Evidence From ARDL Approach

• Main Authors: Abdul Rehman, Hengyun Ma, Muhammad Irfan, Munir Ahmad, Ousmane Traore
• Format: Article
• Language: English
• Published: SAGE Publishing 2020-06-01
• Series: SAGE Open
• Online Access: https://doi.org/10.1177/2158244020932525

Tourism is a key source of income and employment today, and different parts of the world are heavily dependent on it. The main purpose of this article was to demonstrate the consequences of long-run and short-run relationship on international tourism in Pakistan and its impact on economic growth by applying an autoregressive distributed lag (ARDL) bounds testing approach. Augmented Dickey–Fuller unit root test was employed to check the stationarity of the variables, while an ARDL bounds testing approach was used to measure the long-run and short-run dynamics linkage among the study variables. The results show that international tourism and expenditures for passenger transport items have a positive impact on economic growth. Similarly, long-run dynamics also revealed that international tourism expenditures for travel items and international tourism expenditures, international tourism receipts for passenger transport items and international tourism receipts for travel items also had a positive impact on the economic growth. The present analysis of the long-run suggested better policies should be implemented to attract more international tourists to the country.