Visit and Buy. An Empirical Analysis on Tourism and Exports

TitleVisit and Buy. An Empirical Analysis on Tourism and Exports
Publication TypeWorking Paper
Year of Publication2012
AuthorsAM. Pinna
Number2012_18
Keywordsgravity, tourism, trade
Abstract

The impact of international tourism flows has been poorly studied within the international trade literature. In this paper I use disaggregated bilateral data on both movements of people and movements of goods in order to carry out a panel data analysis on how the two flows are linked. Rajan and Zingales (1998) methodology is applied in order to identify those products (experienced goods) which are more likely to be sampled by foreign visitors. I concentrate on 11 manufacturing industries whose products are ’local’ varieties and are likely to be part of the traveling experience. I compute an index of experienced good intensity and I use products which are not final consumption goods as a control group. The identifying strategy enables us to robustly assess the influence of total arrivals in a country on its exports. After considering 25 EU countries, it is found that tourism promotes exports and its effect is not negligible, particularly for the EU15 group, being of 3.5% for sectors at mean of the experienced good intensity distribution.

Citation Key3656
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