The asymmetric impact of real exchange rate on tourism demand

Yeliz Yalcin, Cengiz Arikan, Nezir Kose

European Journal of Comparative Economics, 2021, vol. 18, issue 2, 251-266

Abstract: Europe is a notable tourism region and so international tourist arrivals are getting more crucial day by day for attraction center countries. Besides many economic factors, exchange rate is also main economic determining factor of tourism demand. This paper investigates the asymmetric effects of the real exchange rate on tourism demand by utilizing asymmetric VAR methodology for 10 most popular destinations in Europe. According to empirical results, there is a negative relationship between the real exchange rate and tourism demand, with mixed effects for a few countries. The effect of the currency appreciation on the total number of tourist arrivals is more greatly than the currency depreciation for France, Netherlands, Poland and Turkey. Austria, Greece and Italy are also affected asymmetrically from the currency rate in the long term but not short term. The tourist arrivals in Spain, Germany and the UK are not asymmetrically sensitive to exchange rate. The results show that decrease in exchange rate have greater impact on the tourism demand compared to increase in the exchange rate in asymmetrically affected countries.

Keywords: Real exchange rate; Tourism demand; Asymmetric effect; VAR (search for similar items in EconPapers)
JEL-codes: C32 F3 Z32 (search for similar items in EconPapers)
Date: 2021
References: View complete reference list from CitEc
Citations:

Downloads: (external link)
https://ejce.liuc.it/articles/ejce005.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:liu:liucej:v:18:y:2021:i:2:p:251-266

Access Statistics for this article

European Journal of Comparative Economics is currently edited by Matteo Migheli, Giovanni Ramello, Koji Domon, Peter Grajzl, David M. Kemme, Marcello Signorelli and Richard Watt

More articles in European Journal of Comparative Economics from Cattaneo University (LIUC) Contact information at EDIRC.
Bibliographic data for series maintained by Laura Ballestra ().