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Non-linear Relationship between International Tourism Development and Economic Growth: A Threshold Panel Data Approach |
WU Chun-you XIE Feng-yuan |
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Abstract The paper studies the relationship between international tourism development and economic growth by applying threshold panel data model with panel data of 31 provinces in China from 1997 to 2007. Results show that there is a threshold effect between international tourism development and economic growth in China. When the ratio of international tourism receipts to GDP is lower than 2.36%, there is no significant relation between international tourism and economic growth; however, when the ratio is higher than 2.36%, development of international tourism can significantly promote economic growth; moreover, there is no conditional convergence of economic growth when the ratio is lower or higher than 2.36%, and the hypothesis that development of international tourism can eliminate regional disparity is not verified.
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Received: 05 August 2009
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