Air Pollution and Tourism: Evidence from G20 Countries

Abstract

Theoretically, it is well argued that environmental factors affect the growth of the tourism industry; however, from an empirical perspective, some gaps still exist in the literature. We empirically examine the effect of carbon dioxide (CO 2 ) and particulate matter (PM2.5) emissions on tourist arrivals in a panel of G20 countries. Using annual data from 1995 to 2014 and a series of panel data models, our results suggest that the growth of both CO 2 and PM2.5 emissions adversely affects international tourist arrivals. The results also show that the observed effect of CO 2 emissions is more pronounced in developed economies, while the effect of PM2.5 emissions is stronger for developing economies. Given these findings, our study provides and discusses a number of policy and practical implications.