Revisiting Tourism Flows to the Caribbean: What is Driving Arrivals?
IMF Working Papers, December 18, 2014
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Bibliographic details
- Authors: Nicole Laframboise, Nkunde Mwase, Joonkyu Park, Yingke Zhou
- Published: December 18, 2014
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781498351560.001
Overview
- Study examines determinants of tourism flows to the Caribbean and constructs a static nominal price comparison index.
- Focuses on variations based on sample differences and changes over time, especially since 2008.
- Authors: Nicole Laframboise, Nkunde Mwase, Joonkyu Park, Yingke Zhou.
- Publication date: December 18, 2014.
Key findings
- Tourism arrivals and expenditure are sensitive to both price and income factors in source markets.
- Price and income elasticities of tourism have declined since 2008.
- Price elasticity is statistically insignificant for “high-end” destinations.
- The nominal cost of an average one week beach holiday in the Caribbean is higher than in other beach destinations around the world.
Implications and policy recommendations
- Need for structural reforms to raise product quality in the tourism sector.
- Cost reduction or containment is necessary in “low-end” destinations; exchange rate adjustment is presented as a possible channel for containment.
- Aggregate consumption may need to adjust to the implications of a lower contribution to GDP from tourism.
Methodology and scope
- Empirical estimation of determinants of tourism arrivals and expenditure.
- Exploration of variations based on sample differences.
- Construction of a static nominal price comparison index to compare costs of beach holidays.
Revisiting Tourism Flows to the Caribbean: What is Driving Arrivals? — Nicole Laframboise, Nkunde Mwase, Joonkyu Park, Yingke Zhou; IMF Working Paper No. 2014/229; December 18, 2014.