The Empirical Test on the Impact of Climate Volatility on Tourism Demand: A Case of Japanese Tourists Visiting Korea

Yun Seop Hwang, Hyung Sik Harris Kim and Cheon Yu
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Yun Seop Hwang: Department of International Business and Trade, College of Politics and Economics KyungHee University, Seoul 02447, Korea
Hyung Sik Harris Kim: Research Department, The Bank of Korea, Seoul 04514, Korea
Cheon Yu: The International Trade Research Center at KyungHee University, Seoul 02447, Korea

Sustainability, 2018, vol. 10, issue 10, 1-14

Abstract: As climate is not only a valuable tourism resource but also a factor influencing travel experience, estimating climate volatility has implications for sustainable development of the tourism industry. This study develops the Climate Volatility Index (CVI) using a Generalized Autoregressive Conditional Heteroscedasticity (GARCH) model and estimates the relationship between CVI and Japanese tourism demand in Korea, using a tourism demand model based on monthly data from January 2000 to December 2013. Possible time lags and multicollinearity among variables are considered for the model specification. The results show that an increase in climate volatility leads to a decrease in tourism demand.

Keywords: tourism demand; climate change; climate volatility; GARCH model (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:gam:jsusta:v:10:y:2018:i:10:p:3569-:d:173977

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