Is there growth impact of tourism? Evidence from selected small island states

Abstract

This study investigates the growth impact of international tourist arrivals on carbon emissions in selected small island states via Environmental Kuznets Curve (EKC) hypothesis. The study employed a panel-based multivariate model for seven small islands between the periods of 1995 and 2013 to evaluate the long-run equilibrium relationships between international tourism and carbon emissions through the channels of energy consumption and economic growth. Findings from the panel cointegration results show the existence of a long-run equilibrium relationship between the variables of interest. International tourist arrivals have a negatively significant impact on carbon dioxide emissions in the long run. Thus, we infer that the law of diminishing marginal returns with regard to tourism-induced EKC hypothesis holds in the case of small island states.