Tourism-induced financial development in Malaysia: New evidence from the tourism development index

Muhammad Shahbaz, Ramzi Benkraiem, Anthony Miloudi () and Aviral Tiwari

Tourism Economics, 2019, vol. 25, issue 5, 757-778

Abstract: This article explores the relationship between tourism development and financial development by incorporating economic growth and the real effective exchange rate as additional determinants in the finance demand function of the Malaysian economy. Thus, the analysis relies on the bounds testing approach by accommodating structural breaks to examine the cointegration among the variables and investigates the causal direction between the variables by applying the Toda–Yamamoto Granger causality approach. The results show that all the variables are cointegrated over the period from 1975 to 2016; tourism development is positively related to financial development; economic growth is positively linked with financial development; and real exchange rate is negatively associated with financial development. The Granger causality analysis demonstrates the presence of bidirectional causality between tourism development and financial development as well as a unidirectional causal relationship running from financial development and tourism development to economic growth.

Keywords: demand function; financial development; Malaysia; tourism development (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
https://journals.sagepub.com/doi/10.1177/1354816618806123 (text/html)

Related works:
Working Paper: Tourism-induced financial development in Malaysia: New evidence from the tourism development index (2019)
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:sae:toueco:v:25:y:2019:i:5:p:757-778

DOI: 10.1177/1354816618806123

Access Statistics for this article

More articles in Tourism Economics
Bibliographic data for series maintained by SAGE Publications ().