Inbound tourism and long-run economic growth

There is an upsurge of literature investigating the relationship between inbound tourism
expansion and economic growth with special emphasis on developing countries. Some
countries – such as Spain and Italy – can be taken as examples of demonstrating such
a successful trajectory. This paper provides an empirical investigation of the evolution
of the Spanish and Italian economies and their respective tourism sectors from the
1950s and 1960s, respectively. This research is theoretically based on the literature on
demand-based growth and the methodology adopted is that of the integration,
cointegration and multivariate Granger causality tests. The results show the influencing
role of inbound tourism for both economies.