Estimating on Pleasure Tourism and Business Tourism

In this subsection, different types of tourism flows are estimated. Based on the information criteria discussed in previous subsection, I choose the models with the smallest BIC value, columns (3), (6)-(8) in Table 6, to estimate on pleasure (lnVTP)

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and business (lnVBZ) tourism flows. The estimation results of pleasure tourism and business tourism are shown in columns (1)-(4) and (5)-(8) of Table 9, respectively.

As shown in column (1), the coefficient of per capita GDP is 0.108, being positive but statistically insignificant, which means that holding other constant, a 10% rise in per capita GDP would be associated with a 1.08% increase in tourist arrivals for pleasure (TP). The coefficient of distance is -0.771, being negative and statistically significant, indicating that TP should decrease 7.71% if the distance between two countries increases by 10%. The coefficient of percentage of industry value-added to total GDP is 0.463, being positive and statistically significant, predicting that holding other constant, a 10% rise in the industry value in percent of GDP would be associated with a 4.63% increase in tourist arrivals for pleasure. The coefficient of population is -0.221, being negative and statistically significant, which indicates that TP should decrease 2.21% if the population of country i rises by 10%.

The coefficient of total trade is 1.163, being positive and statistically significant, which means that holding other constant, a 10% rise in total trade should be associated with an 11.63% increase in tourist arrivals for pleasure.

In column (2), the coefficient of per capita GDP is 0.404, being positive and statistically significant, which means that holding other constant, a 10% rise in per capita GDP would be associated with a 4.04% increase in tourist arrivals for pleasure. The coefficient of distance is -1.086, being negative and statistically significant, indicating that TP should decrease 10.86% if the distance between two countries increases by 10%. The coefficient of percentage of industry value-added to total GDP is 0.923, being positive and statistically significant, predicting that holding other constant, a 10% rise in the industry value in percent of GDP would be associated with a 9.23% increase in tourist arrivals for pleasure. The coefficient of total trade is 1.018, being positive and statistically significant, which means that

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holding other constant, a 10% rise in total trade should be associated with a 10.18%

increase in tourist arrivals for pleasure. The coefficient of price level is 0.05, being positive but statistically insignificant, indicating that TP should increase 0.5% if the price level falls by 10%.

In column (3), the coefficient of per capita GDP is 0.16, being positive and statistically significant, which means that holding other constant, a 10% rise in per capita GDP would be associated with a 1.6% increase in tourist arrivals for pleasure.

The coefficient of distance is -1.242, being negative and statistically significant, indicating that TP should decrease 12.42% if the distance between two countries increases by 10%. The coefficient of percentage of industry value-added to total GDP is 0.99, being positive and statistically significant, predicting that holding other constant, a 10% rise in the industry value in percent of GDP would be associated with a 9.9% increase in tourist arrivals for pleasure. The coefficient of total trade is 0.999, being positive and statistically significant, which means that holding other constant, a 10% rise in total trade should be associated with a 9.99% increase in tourist arrivals for pleasure. The coefficient of exchange rate is -0.074, being negative and statistically significant, which means that TP should decrease 0.74% if the exchange rate rises by 10%. The coefficient of urban population ratio is 0.773, being positive and statistically significant, predicting that TP should increase 7.73%

if the urban population ratio rises by 10%.

In column (4), the coefficient of per capita GDP is 0.149, being positive and statistically significant, which means that holding other constant, a 10% rise in per capita GDP would be associated with a 1.49% increase in tourist arrivals for pleasure. The coefficient of distance is -1.426, being negative and statistically significant, indicating that TP should decrease 14.26% if the distance between two countries increases by 10%. The coefficient of percentage of industry value-added to

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total GDP is 1.179, being positive and statistically significant, predicting that holding other constant, a 10% rise in the industry value in percent of GDP would be associated with a 11.79% increase in tourist arrivals for pleasure. The coefficient of total trade is 0.989, being positive and statistically significant, which means that holding other constant, a 10% rise in total trade should be associated with an 9.89%

increase in tourist arrivals for pleasure. The coefficient of exchange rate is -0.092, being negative and statistically significant, which means that TP should decrease 0.92% if the exchange rate rises by 10%. The coefficient of urban population ratio is 0.908, being positive and statistically significant, predicting that TP should increase 9.08% if the urban population ratio falls by 10%. The coefficient of price level is 0.012, being positive but statistically insignificant, indicating that TP should increase 0.12% if the price level rises by 10%.

In column (5), the coefficient of per capita GDP is 0.408, being positive and statistically significant, which means that holding other constant, a 10% rise in per capita GDP would be associated with a 4.08% increase in tourist arrivals for business (BZ). The coefficient of distance is -0.883, being negative and statistically significant, indicating that BZ should decrease 8.83% if the distance between two countries increases by 10%. The coefficient of percentage of industry value-added to total GDP is 0.289, being positive and statistically significant, predicting that holding other constant, a 10% rise in the industry value in percent of GDP would be associated with a 2.89% increase in tourist arrivals for business. The coefficient of population is 0.218, being positive and statistically significant, which indicates that BZ should increase 2.89% if the population of country i rises by 10%. The coefficient of total trade is 0.617, being positive and statistically significant, which means that holding other constant, a 10% rise in total trade should be associated with an 6.17% increase in tourist arrivals for business.

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In column (6), the coefficient of per capita GDP is 0.093, being positive and statistically significant, which means that holding other constant, a 10% rise in per capita GDP would be associated with a 0.93% increase in tourist arrivals for business. The coefficient of distance is -1.04, being negative and statistically significant, indicating that BZ should decrease 10.4% if the distance between two countries increases by 10%. The coefficient of percentage of industry value-added to total GDP is -1.251, being negative and statistically significant, predicting that holding other constant, a 10% rise in the industry value in percent of GDP would be associated with a 12.51% decrease in tourist arrivals for business. The coefficient of total trade is 0.779, being positive and statistically significant, which means that holding other constant, a 10% rise in total trade should be associated with a 7.79%

increase in tourist arrivals for business. The coefficient of price level is -0.038, being negative but statistically insignificant, indicating that BZ should decrease 0.38% if the price level falls by 10%.

In column (7), the coefficient of per capita GDP is 0.339, being positive and statistically significant, which means that holding other constant, a 10% rise in per capita GDP would be associated with a 3.39% increase in tourist arrivals for business. The coefficient of distance is -0.641, being negative and statistically significant, indicating that BZ should decrease 6.41% if the distance between two countries increases by 10%. The coefficient of percentage of industry value-added to total GDP is 0.237, being positive and statistically significant, predicting that holding other constant, a 10% rise in the industry value in percent of GDP would be associated with a 2.37% increase in tourist arrivals for business. The coefficient of total trade is 0.791, being positive and statistically significant, which means that holding other constant, a 10% rise in total trade should be associated with a 7.91%

increase in tourist arrivals for business. The coefficient of exchange rate is -0.078,

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being negative and statistically significant, which means that BZ should decrease 0.78% if the exchange rate rises by 10%. The coefficient of urban population ratio is -1.387, being negative and statistically significant, predicting that BZ should decrease 13.87% if the urban population ratio rises by 10%.

In column (8), the coefficient of per capita GDP is 0.225, being positive and statistically significant, which means that holding other constant, a 10% rise in per capita GDP would be associated with a 2.25% increase in tourist arrivals for business. The coefficient of distance is -0.937, being negative and statistically significant, indicating that BZ should decrease 9.37% if the distance between two countries increases by 10%. The coefficient of percentage of industry value-added to total GDP is -0.823, being positive and statistically significant, predicting that holding other constant, a 10% rise in the industry value in percent of GDP would be associated with a 8.23% increase in tourist arrivals for business. The coefficient of total trade is 0.795, being positive and statistically significant, which means that holding other constant, a 10% rise in total trade should be associated with an 7.95%

increase in tourist arrivals for business. The coefficient of exchange rate is -0.043, being negative and statistically significant, which means that TP should decrease 0.43% if the exchange rate rises by 10%. The coefficient of urban population ratio is -0.817, being negative and statistically significant, predicting that BZ should decrease 8.17% if the urban population ratio rises by 10%. The coefficient of price level is -0.019, being positive but statistically insignificant, indicating that BZ should increase 0.19% if the price level falls by 10%.

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 Table 9. The Estimation Results of Pleasure and Business Tourism Flows

(1) (2) (3) (4) (5) (6) (7) (8)

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