The impact of tourism on income inequality in developing economies: Does Kuznets curve hypothesis exist?

By Md. Mahmudul Alam, S. Paramati. 2016

292 citations recorded by the source corpus.

This paper investigates the impact of tourism on income inequality in developing economies. The analysis utilizes a balanced panel data set from 1991 to 2012 on 49 developing economies around the world. The empirical findings confirm the long-run equilibrium relationship among the variables. Results from long-run elasticities indicate that tourism increases income inequality significantly. Further, the long-run elasticities on squared tourism revenue confirm the existence of Kuznets curve hypothesis between tourism revenue and income inequalities, meaning that if the current level of tourism becomes double then it will significantly reduce the income inequality in developing economies. Given these findings, our study offers significant value to the body of knowledge on the issue of tourism and income inequality in developing economies and also provides important policy implications.

Subfields: Economics and Econometrics, Sociology and Political Science

View Paper: https://www.semanticscholar.org/paper/26a4a1ef102de0f32d6b733003c81acc33d24546

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Citations in the corpus

The impact of tourism on CO2 emission in Turkey (2020, background): “According to Alam and Paramati (2016), tourism supports economic growth through foreign exchange earnings, international investments, increased tax revenues, and new business opportunities.”
The smart city as a common place for tourists and residents: A structural analysis of the determinants of urban attractiveness (2017, unknown): “…of local price level, average house rent, and security and safety, the negative association can be supported by the extant literature on negative social externalities from tourism (e.g. Füller & Michel, 2014; Alam & Paramati, 2016; Gutiérrez, García-Palomares, Romanillos, & Salas-Olmedo, 2017).”
Panel evidence on the impact of tourism growth on poverty, poverty gap and income inequality (2019, methodology): “To avoid this problem, the forward mean-differencing is employed (see the Helmert procedure in Arellano and Bover 1995) to preserve orthogonality between the transformed variables and lagged regressors so that lagged regressors can be used as instruments.”
The effect of tourism investment on tourism development and CO2 emissions: empirical evidence from the EU nations (2018, result): “A number of previous studies (Alam et al., 2015; Alam & Paramati, 2016) have used panel cointegration test to examine the long-run equilibrium relationship among the variables.”