Tourism Economics in Sri Lanka: An Econometric Analysis

Prasanna-Perera Lalith Welgamage ()
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Prasanna-Perera Lalith Welgamage: Senior Lecturer in Economics & Statistics, Department of Economics and Statistics, University of Peradeniya, Sri Lanka,

International Journal of Business and Social Research, 2015, vol. 5, issue 1, 90-101

Abstract: Sri Lanka aims to transform its tourism sector into one of the largest foreign exchange earners in 2016 by attracting 2.5 million high spending tourists. Tourism was ranked as the fifth largest source of foreign exchange earnings in 2012, and third largest in 2013 contributing 5.2 percent to total foreign earnings of the country. Further to this, the Sri Lankan government also identified tourism as a major hub of the country’s economy. Given the multi-dimensional impact the sector has on the country’s economy, it has to be examined systematically. This paper develops an econometric model based on the Cobb-Douglas function to analyze the relation between foreign exchange earnings, tourist arrivals, tourist prices, and tourist spending and direct employment in tourism. These variables of tourism are estimated utilizing model parameters such as R-Studio based on data from the sample period from 2002 to 2013. The formula presented in this study can be used by policy makers to calculate future foreign exchange earnings, employment, arrivals and prices related to tourism in Sri Lanka.

Keywords: Employment; foreign exchange; R-Studio; Sri Lanka; tourism industry. (search for similar items in EconPapers)
JEL-codes: C22 E01 F43 L83 O53 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:lrc:larijb:v:5:y:2015:i:1:p:90-101

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