The journey towards dollarization: the role of the tourism industry

There has been an increasing wave of globalization since the turn of the millennium. This study focuses on two by-products of globalization: dollarization and tourism. Empirical studies have ignored the possible relationship between dollarization and tourism. However, we hypothesize that a booming t...

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Bibliographic Details
Published in:Current issues in tourism 2021-11, Vol.24 (22), p.3182-3188
Main Authors: Raheem, Ibrahim D., Ajide, Kazeem B.
Format: Article
Language:English
Subjects:
Currencies
Dollarization
Globalization
Outliers (statistics)
Sub-saharan Africa
Tourism
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Summary:There has been an increasing wave of globalization since the turn of the millennium. This study focuses on two by-products of globalization: dollarization and tourism. Empirical studies have ignored the possible relationship between dollarization and tourism. However, we hypothesize that a booming tourism industry will fuel increase in the usage and circulation of foreign currencies, thus increasing the level of dollarization. The objective of this study is to examine the extent to which the tourism industry exacerbates the dollarization process of selected Sub-sahara African (SSA) countries. Using Tobit regression, we found that tourism positively affects dollarization. Our results are robust to: (i) alternative measures of tourism; (ii) accounting for endogeneity and outlier effects.
ISSN:1368-3500
1747-7603
DOI:10.1080/13683500.2020.1863929