A Dynamic Study of the Relationship between Inbound Tourism and Regional Economic Growth

摘要

This paper applies the panel unit roots, heterogeneous cointegration and causality test techniques to re-investigate the relationship between inbound tourism and regional economic growth of 27 provinces, autonomous regions and municipalities in China for the 1995-2007 period. The result indicates that on the nationwide scale, there is a long-term equilibrium between foreign exchange earnings from tourism and local GDP in the east, central and west of China and that inbound tourism of each crosssection has a positive effect on its economic growth. Additionally, the elasticity of the west is the largest and that of the central region is the smallest, as viewed from the overall effect. Finally, economic growth is the Granger cause of inbound tourism development in all the three regions in the long term and the causality is strong while inbound tourism and economic growth in the west forms a short-term feed-back effect.