Acceso usuarios
Anupam Dutta
Objective: The present study intends to examine the long- and short-run associations between average hotel prices and the international tourism demand in Singapore.
Theoretical Framework: Employing Johansen Cointegration method and linear ARDL bound tests, we fail to capture the long-term linkage between average hotel prices and the number of visitors in Singapore. We then consider the application of non-linear ARDL (NARDL) models in order to explore whether the non-existence of the long-run connection is due to the non-linear structure of the variables.
Method: We use monthly data which range from January 1995 to December 2022 yielding a total of 336 observations. All the data on average room rate and total tourist arrivals are retrieved from Thomson Reuters DataStream database. The starting period of the data used in our empirical analysis is dictated by data availability.
Results and Discussion: The findings reveal that the NARDL model successfully detects the aforesaid association between the variables under consideration. Furthermore, adopting the Toda–Yamamoto test for Granger causality suggests a strong bidirectional short-run connection between these two variables.
Research Implications: Policymakers could utilize these outcomes to implement appropriate strategies (e.g., stabilizing the hotel prices, rebranding the country as an attractive destination) for receiving significant attention from international tourists.
Originality/Value: Although Singapore has been one of the major destinations for international tourists over the years, assessing the relationship between average hotel prices and the total number tourists visiting Singapore does not receive much attention in earlier studies. This study aims to extend such scarce literature.
