The moderation effects of political Instability and terrorism on tourism development: a cross-country panel analysis

Saha, Shrabani and Yap, Ghialy (2014) The moderation effects of political Instability and terrorism on tourism development: a cross-country panel analysis. In: 23rd Annual Conference on Contemporary Issues in Development Economics, Jadavpur University, January 6-7, 2014, Kolkata, India.

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Abstract

Looking at the current political turmoil across the globe, this study aims to analyze the effects of interaction between political instability and terrorism on tourism development using panel data from 139 countries for the period 1999–2009. The study measures the extent to which a country’s political conflicts and terrorism can negatively impact its tourism industry. The results reveal that the effect of political instability on tourism is far more severe than the effects of one-off terrorist attacks. Surprisingly, the findings suggest that terrorist attacks increase tourism demand for those low- to moderate-political-risk countries. However, countries that experience high levels of political risk witness significant reductions in their tourism businesses. In addition, political volatility and terrorism together can cause serious damage to the tourism industry.

Keywords:political instability, terrorism, tourism, moderation effect analysis, panel data
Subjects:L Social studies > L100 Economics
Divisions:Lincoln International Business School
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http://purl.org/dc/terms/hasVersionhttp://eprints.lincoln.ac.uk/13654/
ID Code:13403
Deposited On:23 Mar 2014 21:33

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