Dynamic panel data modelling of international tourist arrivals to Maldives : research and policy notes RPN 4-19

Abstract

This paper aims to model international tourist arrivals to Maldives. Using panel data of annual tourist arrivals from 35 countries, various models were estimated for the time period 2001-2016. Four different econometric models which include, the pooled Ordinary Least Squares (OLS), the “within” fixed effect panel regression model, the Arellano-Bond Generalised Method of Moments (GMM) estimation technique, and the Blundell-Bond system GMM technique, were used to identify the main determinants of inbound tourism in Maldives. The results indicate the high fidelity of tourists visiting Maldives, as well as, the significance of income of the tourist generating country in determining the number of arrivals. In addition, results also illustrate, the importance of excluding mutually exclusive variables for exchange rates and prices in the empirical model