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Good Governance and Tourism in South Asian Emerging Economies: The Mediating Role of Foreign Direct Investment

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This study examined the role of good governance in promoting tourism in emerging South Asian countries and also tested the mediating role of foreign direct investments (FDI). The study used panel data collected from seven South Asian countries from 1996 to 2018. Panel data regression models were estimated to test the research hypotheses. The results showed that the country’s good governance has a positive and significant influence on tourism receipts and arrivals. Moreover, the mediation analysis results supported that foreign direct investments mediated the relationship between good governance indicators like government effectiveness, political stability, voice and accountability, and control over corruption and tourism. Based on the results, the study proposed the governance-led FDI and FDI-led tourism hypotheses, the study’s main contribution. The study has implications for the government regulatory agencies relating to governance, tourism departments, foreign prospect investors, and policymakers.

Keywords: FOREIGN DIRECT INVESTMENTS (FDI); GOOD GOVERNANCE; SOUTH ASIAN COUNTRIES; TOURISM

Document Type: Research Article

Affiliations: 1: Institute of Business and Management Sciences (IBMS), The University of Agriculture Peshawar, KP, Pakistan 2: Department of Management Sciences, Islamia College Peshawar, KP, Pakistan 3: Department of Accounting and Financial Management, Faculty of Business and Law, University of Portsmouth, UK 4: Qaid Azam College of Commerce, The University of Peshawar (UOP), KP, Pakistan

Publication date: March 5, 2024

This article was made available online on September 15, 2023 as a Fast Track article with title: "Good Governance and Tourism in South Asian Emerging Economies: The Mediating Role of Foreign Direct Investment".

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  • Established in 1996, Tourism Analysis is an interdisciplinary journal that provides a platform for exchanging ideas and research in tourism and related fields. The journal aims to publish articles that explore a broad range of research subjects, including, but not limited to, the social, economic, cultural, environmental, and psychological aspects of tourism, consumer behavior in tourism, sustainable and responsible tourism, and effective operations, marketing, and management.

    Tourism Analysis focuses on both theoretical and applied research and strives to promote innovative approaches to understanding the complex and dynamic nature of tourism, its stakeholders, businesses, and its effects on society. The journal welcomes articles on innovative research topics and methodologies beyond the traditional theory-testing sciences, such as robotics, computational sciences, and data analytics.

    Our primary goal is to contribute to the development and advancement of new knowledge in tourism while fostering critical reflections and debates on the radical changes and evolution in tourism among scholars, practitioners, policymakers, and other stakeholders.
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