Tourism-Led Growth Hypothesis in Malaysia: Evidence Based Upon Regime Shift Cointegration and Time-Varying Granger Causality Techniques
Document Type
Article
Publication Date
1-1-2015
Abstract
This article examines the tourism-led growth (TLG) hypothesis in Malaysia based upon quarterly data from 1991:Q1 to 2014:Q1. The Johansen-Juselius cointegration and the regime shift cointegration tests consistently show evidence of cointegration. In addition, we find evidence of unidirectional causality from tourism to economic growth in Malaysia. Furthermore, the rolling Granger causality test confirms that the TLG hypothesis is generally valid and stable in Malaysia. Therefore, tourism is an effective long-term engine of growth. Policies to promote tourism would effectively invigorate Malaysia's long-term economic growth and development in Malaysia.
Keywords
Cointegration, Tourism-led growth hypothesis, Rolling regression, Malaysia
Divisions
FacultyofEconomicsAdministration
Publication Title
Asia Pacific Journal of Tourism Research
Volume
20
Issue
1
Publisher
Taylor & Francis