TOURISM AND GROWTH IN SINGAPORE: NEW EXTENSION FROM BOUNDS TEST TO LEVEL RELATIONSHIPS AND CONDITIONAL GRANGER CAUSALITY TESTS

This paper empirically investigates the tourism-led growth (TLG) hypothesis in the case of Singapore by employing the bounds test to cointegration, error correction models and Granger causality tests using annual data from 1960 to 2007. Results confirm the existence of long-term equilibrium relation...

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Bibliographic Details
Published in:Singapore economic review 2011-08, Vol.56 (3), p.441-453
Main Author: Katircioglu, Salih Turan
Format: Article
Language:English
Subjects:
Case studies
Causality
Economic analysis
Economic growth
Economic theory
Empirical research
Error correction models
Hypotheses
International trade
Leisure
Singapore
Studies
Tourism
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Summary:This paper empirically investigates the tourism-led growth (TLG) hypothesis in the case of Singapore by employing the bounds test to cointegration, error correction models and Granger causality tests using annual data from 1960 to 2007. Results confirm the existence of long-term equilibrium relationship between international tourism and economic growth in the case of Singapore; real income growth converges to its long-term equilibrium level significantly by 51.4% in the TLG model. The major finding of this study is that the TLG hypothesis is confirmed for the Singaporean economy in the long-term as a result of conditional Granger causality tests.
ISSN:0217-5908
1793-6837
DOI:10.1142/S0217590811004365