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Home / Tourism Analysis, Volume 24, Number 4

An Empirical Analysis of the Impact of Foreign Direct Investment on Tourism Development: The Mauritian Case

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This article investigates the link between foreign direct investment (FDI) and tourism development for the case of the small island economy of Mauritius for the period 1980–2015. The research employs a dynamic time series econometrics framework, namely a vector error correction model (VECM), to account for potential dynamic and endogenous relationship in the FDI–tourism nexus. Analysis of the finding shows that FDI has a positive and significant effect, albeit relatively lower compared to the other classical factors of tourism development, in the long run. Interestingly, a bicausal effect is observed in the long run while an indirect link between FDI and tourism development via the economic growth channel is found.

Keywords: FOREIGN DIRECT INVESTMENT (FDI); TOURISM DEVELOPMENT; VECTOR AUTOREGRESSIVE (VAR)/VECTOR ERROR CORRECTION MODEL (VECM)

Document Type: Research Article

Publication date: 13 November 2019

This article was made available online on 13 August 2019 as a Fast Track article with title: "An Empirical Analysis of the impact of FDI on Tourism development - The Mauritian Case".

More about this publication?
  • 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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