Tourism and Growth Nexus in the Eu

Variable label	Description	Data source
Dependent variables
EG	Growth rate of real GDP per capita	World Development Indicators of the World Bank
EGnet	Growth rate of real GDP per capita net of tourism. Variable GDP net of tourism is obtained by subtracting travel expenditure from GDP.	World Development Indicators of the World Bank
Independent variables
lagGDPpc	Lagged value of the log of GDP per capita	World Development Indicators of the World Bank
Tourism development	Travel expenditure per capita in US$ Millions	UNWTO Tourism Statistics Database
Tourism specialisation	Travel expenditure as a percentage of GDP	World Development Indicators and World Tourism Organization
GDPpcNet	Real GDP per capita net of tourism. Variable GDP net of tourism is obtained by subtracting travel expenditure from GDP.	World Development Indicators of the World Bank
Control variables
Capital formation	Gross capital formation as a percentage of GDP (a measure of the stock of physical capital and a proxy for infrastructure)	World Development Indicators of the World Bank
Openness	Trade openness (measured by the sum of international exports and imports as a percentage of GDP)	World Development Indicators of the World Bank
Expenditure	Government’s size (measured as government expenditure as a percentage of GDP)	World Development Indicators of the World Bank
Corruption	The level of corruption (measured by the Bayesian Corruption Index, bci index)	Quality of Government Dataset (Teorell et al., 2020)
Human capital	Human capital index based on average schooling years and return-to-education rates (pwt_hci index)	Barro and Lee (2013), Penn World Tables 9.0 (Feenstra et al., 2015)

1 Note: All variables, except the indices of the human capital and corruption, are In-transformed.

Tab. 2:

Tourism development and growth: dependent variable growth rate of real GDP per capita (EG)

Variable	mFE	m2SLS	mQ10	mQ30	mQ50	mQ70	mQ90
lagGDPpc	–0.2450***	–0.2700***	–0.2174***	–0.2337***	–0.2458***	–0.2565***	–0.2730***
Tourism development	0.0784**	0.0775***	0.0798**	0.0790**	0.0784^*	0.0778^*	0.0770
Capital formation	0.1184***	0.1284***	0.1332***	0.1245***	0.1180***	0.1122***	0.1033***
Openness	0.0249	0.0139	0.1339^*	0.0694	0.0217	–0.0206	–0.0859**
Expenditure	– 0.1031	–0.1235^*	–0.0339	–0.0748	–0.1052	–0.1320	–0.1735
Corruption	–0.0014***	– 0.0016***	–0.0013*	–0.0013***	–0.0014***	–0.0014**	–0.0015*
Human capital	–0.0348	–0.0083	–0.0050	–0.0226	–0.0357	–0.0472	–0.0650
Observation	539	485	539	539	539	539	539
Countries	27	27	27	27	27	27	27
R-squared	0.8897	0.8878
Pseudo R-squared			0.8427	0.8838	0.8930	0.8828	0.8335

1 Note: Column mFE reports the results of the Fixed Effects model. Column m2SLS reports the results of the 2SLS model where lagGDPpc and tourism variables are instrumented using both the first and second lags as instruments, respectively. Robust standard errors clustered at the country level are calculated for mFE and m2SLS. The results of Method of moments quantile regression (MMQR models) with jackknife standard errors clustered at the country level are in columns Q10 to Q90. All regressions include time dummies and a constant term;

1***, **, * denote statistical significance at the 1%, 5% and 10% level, respectively.

Tab. 3:

Tourism specialisation and growth: dependent variable growth rate of real GDP per capita (EG)

Variable	mFE	m2SLS	mQ10	mQ30	mQ50	mQ70	mQ90
lagGDPpc	–0.1801***	–0.2072***	–0.1696***	–0.1761***	–0.1804***	–0.1842***	–0.1902***
Tourism specialisation	0.0360	0.0607**	0.0491	0.0410	0.0358	0.0309	0.0236
Capital formation	0.1173***	0.1323***	0.1446***	0.1277***	0.1167***	0.1066***	0.0912***
Openness	0.0625**	0.0283	0.1767**	0.1063*	0.0602*	0.0180	–0.0466
Expenditure	–0.1140*	–0.1321**	–0.0452	–0.0876	–0.1154	–0.1408	–0.1797
Corruption	–0.0013***	–0.0017***	–0.0016*	–0.0014**	–0.0013***	–0.0013**	–0.0011
Human capital	–0.0230	–0.0071	–0.0050	–0.0226	–0.0357	–0.0472	–0.0650
Observation	539	485	539	539	539	539	539
Countries	27	27	27	27	27	27	27
R-squared	0.8760	0.8720
Pseudo R-squared			0.8109	0.8683	0.8797	0.8669	0.8050

1 Note: Column mFE reports the results of the Fixed Effects model. Column m2SLS reports the results of the 2SLS model where lagGDPpc and tourism variables are instrumented using both the first and second lags as instruments, respectively. Robust standard errors clustered at the country level are calculated for mFE and m2SLS. The results of MMQR models with jackknife standard errors clustered at the country level are in columns Q10 to mQ90. All regressions include time dummies and a constant term;

1***, **, * denote statistical significance at the 1%, 5% and 10% level, respectively.

Tab. 4:

Tourism and net growth: dependent variable growth rate of real GDP per capita net of tourism (EGnet)

Variable	mFE	m2SLS	mQ10	mQ30	mQ50	mQ70	mQ90
lagGDPpcNet	–0.3134***	–0.2967***	–0.2807***	–0.2987***	–0.3132***	–0.3289**	–0.3486**
Tourism development	0.0876**	0.0554***	0.0796**	0.0840*	0.0876*	0.0914	0.0963
Capital formation	0.1231***	0.1100***	0.1405***	0.1309***	0.1232***	0.1149***	0.1044***
Openness	0.0321	0.0038	0.1646*	0.0918	0.0328	–0.0306	–0.1103*
Expenditure	–0.1279*	–0.1452**	–0.0685	–0.1011	–0.1276	–0.1560	–0.1917
Corruption	–0.0019**	–0.0018***	–0.0020*	–0.0019**	–0.0019**	–0.0018**	–0.0017
Human capital	–0.0384	–0.0112	–0.0114	–0.0263	–0.0383	–0.0512	–0.0675
Observation	539	485	539	539	539	539	539
Countries	27	27	27	27	27	27	27
R-squared	0.8760	0.8720
Pseudo R-squared			0.8003	0.8733	0.8847	0.8392	0.7174

1 Note: Column mFE reports the results of the Fixed Effects model. Column m2SLS reports the results of the 2SLS model where lagGDPpcNet and tourism variables are instrumented using both the first and second lags as instruments, respectively. Robust standard errors clustered at the country level are calculated for mFE and m2SLS. The results of MMQR models with jackknife standard errors clustered at the country level are in columns Q10 to mQ90. All regressions include time dummies and a constant term;

1***, **, * denote statistical significance at the 1%, 5% and 10% level, respectively.

Tab. 5:

Tourism specialisation and net growth: dependent variable growth rate of real GDP per capita net of tourism (EGnet)

Variable	mFE	m2SLS	mQ10	mQ30	mQ50	mQ70	mQ90
lagGDPpcNet	–0.2410***	–0.2587***	–0.2338***	–0.238***	–0.2411***	–0.2444***	–0.2484**
Tourism specialisation	0.0421	0.0388*	0.0491	0.0450	0.0420	0.0388	0.0349
Capital formation	0.1222***	0.1128***	0.1552***	0.1360***	0.1219***	0.1067***	0.0887***
Openness	0.0727**	0.0165	0.2009**	0.1265*	0.0715*	0.0124	–0.0576
Expenditure	–0.1400**	–0.1535**	–0.0712	–0.1111	–0.1407*	–0.1724*	–0.2100
Corruption	– 0.0019**	–0.0019***	–0.0022**	–0.0020**	–0.0018**	–0.0017*	–0.0015
Human capital	– 0.0258	–0.0097	–0.0004	–0.0151	–0.0260	–0.0378	–0.0517
Observation	539	485	539	539	539	539	539
Countries	27	27	27	27	27	27	27
R-squared	0.8760	0.8720
PseudoR-squared			0.7786	0.8606	0.8709	0.8216	0.7006

1***, **, * denote statistical significance at the 1%, 5% and 10% level, respectively.

References

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Articles in this issue

DOI: https://doi.org/10.2478/revecp-2025-0007 | Journal eISSN: 1804-1663 | Journal ISSN: 1213-2446

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Language: English

Page range: 109 - 122

Published on: May 13, 2026

Published by: Mendel University in Brno

In partnership with: Paradigm Publishing Services

Keywords:

tourism-led growth hypothesis,

economic growth,

core-periphery,

European Union (EU),

panel quantile regression

JEL:

L83,

C33,

O11

Related subjects:

Business and economics,

Political economics,

Economic theory, systems and structures

© 2026 Boris Cota, Nataša Erjavec, Saša Jakšić, published by Mendel University in Brno
This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.

Volume 25 (2025): Issue 2 (December 2025)