The Dynamic Effects of Terrorism on Tourism: A Bound Testing Co-integration Approach

Abstract

Tourism industry is considered a key driver promoting socioeconomic development in under development economy, but there are several factors which hindering this development. The terror incidence in swat valley have severely affected tourism industry of the area. Terrorism is a growing hazard across the globe with severs socio-economic consequences. Pakistan is also playing it’s was against terrorism that it has affected its various economic activities including tourism. During the first decade of the ongoing century, northern mountainous area of Khyber Pakhtunkhwa, which was famous for tourism, was badly affected by incidences of terror2.The objective of this research work is to estimate the impact of terror incidents on domestic tourism in Pakistan, Khyber Pakhtunkhwa, Swat Valley (TA –domestic visitors’ arrivals).The current research is an effort to evaluate the short-term and long-term association between events of terror and domestic visitation. Primary data was collected using stratified random sampling techniques and interview method and secondary data was taken from various sources to evaluate the model. Auto Regressive Distributive Lag (ARDL) model is used to evaluate the data. The ARDL bound test confirms the co-integration between terror incidents and tourism. Additionally, the examined findings undoubtedly ensure the negative short-term and long-term impact of events of terror on domestic tourism in the study area.

Revisiting the terrorism–tourism nexus in Nigeria: the moderating role of military spending

“…This also shows that irrespective of the measure of terrorism adopted, terrorism has a significant negative impact on tourism arrival in Nigeria. This result aligns with a priori expectation and supports the findings of Boojhawon and Seetanah (2018) and Shah et al (2020), which showed that terrorism has catastrophic effects on tourism demands in the countries housing the tourist sites. In addition, it lends support to the finding of Alola et al (2021), which states that insurgency leads to a reduction in the number of tourism arrivals.…”

“…The terrorismtourism nexus in Nigeria and Seetanah (2018) and Shah et al (2020), which showed that terrorism has catastrophic effects on tourism demands in the countries housing the tourist sites. In addition, it lends support to the finding of Alola et al (2021), which states that insurgency leads to a reduction in the number of tourism arrivals.…”

“…Historical data shows that Mauritius is not a terrorism-ridden or politically unstable country; thus, it is a haven for tourists. Shah et al (2020) also adopted the ARDL framework to evaluate the tourism effects of terrorism in Pakistan and found that terrorism has a catastrophic effect on domestic tourism both in the short and long run. These findings from Turkey and Pakistan indicate the need to counter terrorism to increase the contribution of the tourism sector to GDP in these countries.…”