Is Tourism Development a Sustainable Economic Growth Strategy in the Long Run? Evidence from GCC Countries

Abdulkarim K. Alhowaish
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Abdulkarim K. Alhowaish: Department of Urban and Regional Planning, University of Dammam, P.O. Box 2397, Dammam 31451, Saudi Arabia

Sustainability, 2016, vol. 8, issue 7, 1-10

Abstract: The main objective of this study is to investigate the causal relationship between tourism development and economic growth in Gulf Cooperation Council (GCC) countries in a multivariate model, using panel data for the period 1995–2012. The study adopts a panel Granger causality analysis approach to assess the contribution of tourism to economic growth in GCC countries as a whole, and in each individual country. In the case of GCC countries as a whole, the results show a one-way Granger causality, from economic growth to tourism growth. Furthermore, Kuwait, Saudi Arabia, Qatar, and the United Arab Emirates follow the path of economy-driven tourism growth, as hypothesized. The reverse hypothesis (i.e., tourism-led growth hypothesis) holds true for Bahrain, while there is no causal relationship between tourism and economic growth in the case of Oman.

Keywords: tourism development; economic growth; panel causality; GCC countries (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (17)

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