Unraveling the links between development,growth,and tourism specialization. A country-panel analysis using self-organizing maps

Abstract

This research explores the relationship between development, economic growth and tourism specialisation in 123 countries between 1995 and 2019. Based on the hypothesis that a single model is inadequate to capture the complex dynamics between these variables, we classify countries before studying the link within each category. The empirical strategy is based on the application of an objective country classification procedure, known as Kohonen’s self-organising maps. This methodology, novel for this field of study, allows countries to be grouped based on the dynamics of several variables. Three distinct groups emerge from this process. We find that causality from tourism specialization to GDP growth and from tourism to human development are observed in low-income countries. While no reverse causality between HDI and tourism is observed in any of the specifications, causality from GDP growth to tourism is verified in the group of high-income countries with heightened tourism specialisation and development.