Revisiting the tourism-growth nexus: evidence from a new index for the market diversification of tourist arrivals

Abstract

This paper introduces the first index for the market diversification of tourist arrivals. Using this new index, we revisit the tourism-growth nexus for eight countries in the Mediterranean region: Egypt, France, Greece, Italy, Morocco, Spain, Tunisia, and Turkey. For this purpose, we run the individual Granger and the panel data non-Granger causality tests for the period from 1995 to 2014. We find the causality from market diversification to economic growth in Egypt and Greece and observe the causality from economic growth to market diversification in France, Morocco, and Turkey. We also find bidirectional causality in Italy, Spain, and Tunisia.