Asymmetric impact of tourism on the balance of payments in Pakistan : evidence from non-linear ARDL
Purpose: The aim of the paper is to determine the asymmetric impact of tourism on the deficit in the balance of payments (BOPs). Design/methodology/approach: The research uses the non-linear autoregressive distributed lag (ARDL) model to investigate the asymmetric impact of tourism on Pakistan's BOPs deficit using quarterly data from 1995 to 2019. Findings: The finding reveals that due to the positive change in tourism, the BOPs deficit decreases by 27%, although due to the negative change in tourism, the BOPs deficit rises by 2.3%. In addition, the significance of F-statistics (10.609) confirms the existence of co-integration between tourism and the deficit in the BOPs. The Wald test confirms the asymmetric association between tourism and the deficit in the BOPs over the long term. Research limitations/implications: In order to improve tourism in Pakistan, policymakers must consider the following implications. First, there is a need for an adequate infrastructure that can help the tourist. Second, the Government must maintain a stable law and order situation as a whole and particularly at tourist destinations. Finally, the Government should develop tourism-friendly policies in order to boost tourism in Pakistan. Originality/value: The research provides new evidence of the impact of tourism on the BOPs using the novel non-linear ARDL (NARDL) technique. The evidence will help policymakers to develop policies to improve tourism in order to reduce the BOPs deficit.
Year of publication: |
2021
|
---|---|
Authors: | Rafiq, Asim ; Aamir, Ameer Muhammad ; Nadeem, Muhammad |
Published in: |
Journal of Economic and Administrative Sciences. - Emerald, ISSN 1026-4116, ZDB-ID 2664448-4. - 2021 (04.11.)
|
Publisher: |
Emerald |
Saved in:
Online Resource
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