Governance, tourism and inclusive growth in Africa

Abstract

The use of Gross Domestic Product (GDP) per capita as a measure of economic growth has been recently subject to wide criticism by many economists. It has been observed that although some countries have experienced economic growth in recent years, income inequality and poverty continue to be exacerbated. Recently, sustainable development goal 8 has been geared to promote inclusive growth. Considering this fact, this study expands the literature by examining the relationship between tourism development and inclusive growth for a panel of 44 African countries over the period 2000–2020. Further, the study also adds to the literature by examining the moderation of governance quality on the tourism‐inclusive growth nexus. The investigation is made using the generalized method of moments as an estimation technique. The result indicates that tourism and governance quality appear to promote inclusive growth. Moreover, the results indicate that good quality of institutions or governance could complement tourism development to promote inclusive growth, as positive synergies are apparent from the role of governance in moderating the incidence of tourism on inclusive growth. Policy implications are discussed.