Asian Tourism Demand For Malaysia: A Bound Test Approach

Abstract

The objective of this paper is to investigate the long-run and short-run relationships among tourist arrivals to Malaysia and tourism price, substitute price, travelling cost, income and exchange rate for Asian7. The autoregressive distributed lag (ARDL) bounds test approach developed by Pesaran et al. (2001) is employed in the analysis, and the data cover the period 1970 to 2004. The empirical results show that in the long-run and short-run the tourism price, travelling cost, substitute price and income are the major determinants of Malaysia's tourism demand. The results also show that word-of mouth effect, world economic crisis and the outbreak of SARS (2002-03) significantly affected the demand for Malaysia's tourism in the shortrun. The findings are consistent with the economic theory and the model passed all the diagnostic tests.

The determinants of inbound tourism demand in Malaysia: another visit with non-stationary panel data approach

“…This is consistent with the theory of consumer behaviour and that of earlier studies (e.g. Kadir et al, 2008;Narayan, 2004;Salleh et al, 2008;Seetanah et al, 2010;Surugiu et al, 2011;Tan et al, 2002;Witt & Martin, 1987). The coefficient of lnP MAL,t reveals that by holding other factors constant, a 10% increase in the price of tourism in Malaysia would result in a 6.5% decline in per capita tourist arrivals from these 12 major tourism markets.…”

“…Some studies (e.g. Habibi et al, 2009;Hanafiah & Harun, 2010;Kadir et al, 2008;Kadir, Nayan, & Abdullah, 2013;Salleh et al, 2008Salleh et al, , 2007Tan, McCahon, & Miller, 2002) found that income has a significant positive impact on tourism demand in Malaysia. However, Kusni, Kadir, and Nayan (2013) and Ooi, Hooy, and Som (2013) discovered that income does not explain tourism demand in Malaysia.…”

Determinants of Chinese demand for tourism in Malaysia

“…Studies done by Mohd Salleh, Law, Ramachandran, Shuib, & Mohd Noor (2008), Ouerfelli (2008), Yang, Lin, & Han (2010), Ekanayake, Halkides, & Ledgerwood (2012) and Puah, Thien, & Arip (2014) have included exchange rate as independent variable and they consistently discovered that exchange rate is an important determinant for estimating tourism demand model. Exchange rate is proven to have a positive relationship with tourism demand in which appreciation or strengthening of tourist origin country's currency would improve tourists' spending power and resulted in more tourists are willing to travel.…”

Is the tourism‐led growth hypothesis stable for Malaysia? A note

“…Malaysia's tourism literature can be classifi ed into three major groups: (i) a descriptive analysis of the tourism industry (for example, Wells, 1982;Wong, 1990;Smith, 1992;Cartier, 1998;Henderson, 2003;Syed Mustapa, 2005;Liu, 2006); (ii) the demand function for tourism (for example, Tan et al, 2003;Salleh et al, 2007Salleh et al, , 2008; and (iii) the dynamic of tourist arrivals and the impact of shocks (for example, Lean and Smyth, 2008;Lean and Smyth, 2009).…”