# Implications of Oil Price Fluctuations for Tourism Receipts: The Case of Oil Exporting Countries

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## Abstract

**:**

## 1. Introduction

## 2. Literature Review

## 3. Data and Methodology

#### 3.1. Data and Variables

#### 3.2. Methodology

#### 3.2.1. Cross-Sectional Dependency Test

#### 3.2.2. Panel Unit Root Tests

#### 3.2.3. Panel Cointegration Test

#### 3.2.4. Panel Granger Non-Causality Test

- ${H}_{0}:\text{}{\beta}_{i}=0,\text{}{\forall}_{i}=1,\dots ,\text{}$;
- ${H}_{1}:\text{}{\beta}_{i}=0,\text{}{\forall}_{i}=1,\dots ,\text{}{N}_{1}\text{}\left(0\le \frac{N1}{N}1\right)\text{};$
- ${H}_{1}:\text{}{\beta}_{ii}\ne 0,\text{}{\forall}_{i}={N}_{1}+1,\text{}{N}_{2}+2\dots ,\text{}N$.

_{0}=$\text{}{\beta}_{i}$= 0.

## 4. Empirical Findings

#### 4.1. Descriptive Statistics

#### 4.2. Cross-Sectional Dependency Test Results

#### 4.3. Panel Unit Root Test

#### 4.4. Panel Cointegration Test Results

#### 4.5. Panel Causality Test

#### 4.6. Robustness Check

_{(t−1)}) was positive in models and statistically significant. The speeds of adjustments (λ) for models (1) and (2) are 15% and 8%, respectively. Low speed of adjustments in model 1 and 2 reveal that attaining the target tourism income is not the primary concern of countries heavily relying on crude oil exports.

## 5. Summary and Conclusions

## 6. Policy Implication

## Author Contributions

## Funding

## Acknowledgments

## Conflicts of Interest

## References

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International Tourist Arrivals (1000) | International Tourism Receipts | |||||||
---|---|---|---|---|---|---|---|---|

2010 | 2016 | 2017 | Change (%) | (US$ million) | ||||

16/15 | 17/16 | 2010 | 2016 | 2017 | ||||

Middle East | 55,442 | 55,556 | 58,113 | −4.4 | 4.6 | 52,150 | 58,959 | 67,654 |

North Africa | 19,682 | 18,895 | 21,717 | 5.0 | 14.9 | 9662 | 9003 | 10,009 |

**Table 2.**International tourism receipts (in thousands) and tourist arrivals by country of destination.

2010 | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | Average | |
---|---|---|---|---|---|---|---|---|---|

Algeria | |||||||||

Int. Tourism receipts | 324,000 | 300,000 | 295,000 | 326,000 | 316,000 | 347,000 | 246,000 | 172,000 | 290,750 |

Number of arrivals | 2070 | 2395 | 2634 | 2733 | 2301 | 1710 | 2039 | 2451 | 2292 |

Bahrain | |||||||||

Int. Tourism receipts | 2,163,000 | 1,766,000 | 1,752,000 | 1,875,000 | 1,913,000 | 2,372,000 | 4,021,000 | 3,836,000 | 2,462,250 |

Number of arrivals | 11,952 | 6732 | 8062 | 9163 | 10,452 | 9670 | 10,158 | 11,370 | 9695 |

Iran | |||||||||

Int. Tourism receipts | 2,631,000 | 2,489,000 | 2,483,000 | 3,306,000 | 4,197,000 | 4,771,000 | 3,914,000 | 398,714 | |

Number of arrivals | 2938 | 3354 | 3834 | 4769 | 4968 | 5237 | 4942 | 4867 | 4364 |

Kuwait | |||||||||

Int. Tourism receipts | 574,000 | 644,000 | 780,000 | 619,000 | 615,000 | 931,000 | 831,000 | 643,000 | 704,625 |

Number of arrivals | 5208 | 5574 | 5729 | 6217 | 6528 | 6941 | 7055 | 6179 | |

Oman | |||||||||

Int. Tourism receipts | 1,072,000 | 1,515,000 | 1,723,000 | 1,888,000 | 1,971,000 | 2,247,000 | 2,390,000 | 2,791,000 | 1,949,625 |

Number of arrivals | 1441 | 1018 | 1241 | 1392 | 1611 | 1909 | 2335 | 2372 | 1625 |

Qatar | |||||||||

Int. Tourism receipts | 4,463,000 | 7,220,000 | 8,452,000 | 10,576,000 | 12,131,000 | 12,593,000 | 15,757,000 | 10,170,286 | |

Number of arrivals | 1699.5 | 2056.7 | 2323.5 | 2611.9 | 2839.2 | 2941.1 | 2938.2 | 2256.5 | 2458 |

Saudi Arabia | |||||||||

Int. tourism receipts | 7,536,000 | 9,317,000 | 8,400,000 | 8,690,000 | 9,263,000 | 11,183,000 | 13,438,000 | 14,848,000 | 10,334,375 |

Number of arrivals | 10,850 | 14,179 | 16,332 | 15,772 | 18,260 | 17,994 | 18,044 | 16,109 | 15,943 |

UAE | |||||||||

Int. tourism receipts | 8,577,000 | 9,204,000 | 10,924,000 | 12,389,000 | 15,221,000 | 17,481,000 | 19,496,000 | 21,048,000 | 14,292,500 |

Number of arrivals | |||||||||

Yemen | |||||||||

Int. Tourism receipts | 1,291,000 | 910,000 | 1,005,000 | 1,097,000 | 1,199,000 | 116,000 | 116,000 | 819,143 | |

Number of arrivals | 1025 | 829 | 874 | 990 | 1017 | 366.7 | 850 |

Variable | Mean | SD | Min | Max |
---|---|---|---|---|

LTR | 20.78 | 1.29 | 17.45 | 23.36 |

LOIL | 4.04 | 0.54 | 3.19 | 4.65 |

GFC | 27.37 | 14.83 | 15.49 | 33.78 |

GEX | 2.79 × 10^{10} | 3.09 × 10^{10} | 2.38 × 10^{9} | 1.67 × 10^{11} |

GDPPC | 21,907.78 | 21,456.27 | 538.2873 | 94,944.09 |

EF | 61.579 | 9.814 | 35.9 | 77.7 |

I | 5.977 | 6.703 | −4.863 | 39.26 |

LTR | LOIL | GFC | GEX | GDPPC | EF | |
---|---|---|---|---|---|---|

LOIL | 0.264 | |||||

GFC | −0.458 | −0.362 | ||||

GEX | 0.519 | 0.385 | −0.240 | |||

GDPPC | 0.601 | 0.131 | −0.414 | 0.163 | ||

EF | 0.231 | 0.035 | −0.291 | −0.348 | 0.617 | |

I | 0.036 | 0.172 | 0.135 | 0.142 | −0.475 | −0.517 |

Pesaran (2004) | ||
---|---|---|

Statistic | p-Value | |

LTR | 7.460 | 0.000 |

LOIL | 5.832 | 0.000 |

GDPPC | 8.165 | 0.000 |

GFC | 14.00 | 0.000 |

GEX | 6.182 | 0.000 |

I | 11.55 | 0.000 |

EF | 8.177 | 0.000 |

Frees test of cross-sectional independence = 0.278 | ||

Note: Critical values from Frees’ Q distribution: | ||

α | Statistic | |

0.10 | 0.3583 | |

0.05 | 0.4923 | |

0.01 | 0.7678 |

M and W | LLC | IPS | CADF | |||||
---|---|---|---|---|---|---|---|---|

Levels | Statistic | p-Value | Statistic | p-Value | Statistic | p-Value | Statistic | p-Value |

LTR | 5.113 | 0.745 | 0.798 | 0.787 | 1.294 | 0.902 | −0.039 | 1.000 |

LOIL | 0.884 | 0.998 | 3.460 | 0.999 | 4.806 | 1.000 | −0.991 | 0.944 |

GDPPC | 0.265 | 1.000 | 1.387 | 0.917 | 6.814 | 1.000 | −2.202 | 0.181 |

GFC | 1.649 | 0.989 | −1.026 | 0.152 | 1.993 | 0.976 | −1.057 | 0.926 |

GEX | 11.722 | 0.164 | −1.233 | 0.108 | −2.103 | 0.136 | −1.998 | 0.312 |

I | 10.248 | 0.248 | −1.584 | 0.056 | −1.205 | 0.114 | −2.118 | 0.230 |

First Differences | ||||||||

LTR | 63.776 *** | 0.000 | −4.168 *** | 0.000 | −4.195 *** | 0.000 | −2.791 ** | 0.017 |

LOIL | 27.260 *** | 0.000 | −11.273 *** | 0.000 | −2.663 *** | 0.003 | −3.158 *** | 0.002 |

GDPPC | 16.822 ** | 0.032 | −2.351 *** | 0.009 | −1.738 ** | 0.041 | −2.869 ** | 0.011 |

GFC | 19.849 ** | 0.010 | −3.435 *** | 0.000 | −1.633 * | 0.051 | −2.947 *** | 0.007 |

GEX | −1.483 * | 0.075 | −4.147 *** | 0.000 | −1.564 * | 0.058 | −3.830 *** | 0.001 |

I | 58.141 *** | 0.000 | −6.942 *** | 0.000 | −4.239 *** | 0.000 | −2.912 *** | 0.009 |

Method | Statistic | p-Value | |
---|---|---|---|

Kao | MDF | −5.713 *** | 0.005 |

DF | −2.041 *** | 0.009 | |

ADF | −6.027 ** | 0.010 | |

Westerlund | G_{t} | −4.639 *** | 0.003 |

G_{a} | −3.527 * | 0.056 | |

P_{t} | −5.734 ** | 0.034 | |

P_{a} | −9.583 * | 0.064 |

Hypothesis | Wald Statistic | Z-Bar Statistic | p-Value | Causal Statistic |
---|---|---|---|---|

LOIL $\to $ LTR | 4.626 *** | 6.245 | 0.000 | YES |

LTR $\to $ LOIL | 0.834 | 1.053 | 0.170 | NO |

GDPPC $\to $ LTR | 3.126 *** | 5.261 | 0.003 | YES |

LTR $\to $ GDPPC | 2.031 ** | 2.988 | 0.016 | YES |

GFC $\to $ LTR | 1.851 * | 2.491 | 0.052 | YES |

LTR $\to $ GFC | 4.173 *** | 5.806 | 0.001 | YES |

GEX $\to $ LTR | 1.895 * | 2.351 | 0.072 | YES |

LTR $\to $ GEX | 0.302 | 0.773 | 0.219 | NO |

I $\to $ LTR | 1.086 | 1.536 | 0.103 | NO |

LTR $\to $ I | 0.871 | 1.103 | 0.161 | NO |

EF $\to $ LTR | 1.716 * | 2.311 | 0.085 | YES |

LTR $\to $ EF | 0.285 | 0.694 | 0.251 | NO |

One-Step GMM (1) | Two-Step GMM (2) | |
---|---|---|

LTR_{t−1} | 0.85 ** (0.02) | 0.92 *** (0.007) |

LOIL | −1.13 ** (0.04) | −0.35 *** (0.008) |

GDPPC | 0.64 * (0.06) | 0.04 ** (0.04) |

GFC | −0.11 * (0.09) | −0.12 ** (0.04) |

GEX | 1.05 ** (0.03) | 2.3 *** (0.007) |

I | 0.03 *** (0.002) | 0.08 * (0.09) |

EF | −0.12 * (0.07) | −0.05 ** (0.03) |

Constant | 6.02 * (0.09) | 10.82 * (0.08) |

Time Dummy | Yes | Yes |

Instruments | L1, L2 | L1, L2 |

AR(1) | 0.12 | 0.16 |

AR(2) | 0.32 | 0.41 |

Hansen (p-value) | 0.21 | 0.16 |

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**MDPI and ACS Style**

Hesami, S.; Rustamov, B.; Rjoub, H.; Wong, W.-K.
Implications of Oil Price Fluctuations for Tourism Receipts: The Case of Oil Exporting Countries. *Energies* **2020**, *13*, 4349.
https://doi.org/10.3390/en13174349

**AMA Style**

Hesami S, Rustamov B, Rjoub H, Wong W-K.
Implications of Oil Price Fluctuations for Tourism Receipts: The Case of Oil Exporting Countries. *Energies*. 2020; 13(17):4349.
https://doi.org/10.3390/en13174349

**Chicago/Turabian Style**

Hesami, Siamand, Bezhan Rustamov, Husam Rjoub, and Wing-Keung Wong.
2020. "Implications of Oil Price Fluctuations for Tourism Receipts: The Case of Oil Exporting Countries" *Energies* 13, no. 17: 4349.
https://doi.org/10.3390/en13174349