The Global Nexus of Tourism, Economy, Renewable Energy and Carbon Emissions in the Last 20 Years

Abstract

The nexus between tourism, economy, renewable use, and carbon emissions is rarely discussed on a global scale by extensive published literature. To fill this gap, this study aims to examine the bidirectional relationships among tourism and other analyzed variables in terms of impulse response and Granger causality from the global perspective. This study uses a panel vector autoregressive model estimated using the system generalized method of moments based on panel data for 114 countries for the years 1995 to 2015. To explore the regional heterogeneity of these relationships, we further divide these countries into 5 regions, namely Asia, Africa, Europe and Oceania, North America, and South America. The results demonstrate that tourism contributes to both global economic growth and carbon emissions. Also, tourism is affected by the economy, renewable energy and carbon emissions. The relationships among the four analyzed variables vary significantly across the regions. Carbon emissions have a longer impact on tourism, relative to the economy. A two-way causal relationship between tourism and renewable energy was not found in this study.