This study examines the causal relationships between environmental sustainability and tourist arrivals (TARR) and expenditures (TEXP) for the top 10 most popular tourist destinations during 2000–2020, utilizing the panel fourier causality method. The results reveal significant causal links between environmental sustainability indicators, such as carbon emissions (CO2), ecological footprint (EF), and environmental policy stringency (EPS), and tourism demand. While CO2 and EF significantly influence TEXP, no direct causality is observed between EPS and TEXP. However, EPS emerges as a key determinant of TARR. The findings highlight bidirectional causality between environmental sustainability and tourism, emphasizing that robust environmental policies are essential for promoting sustainable tourism. Stringent environmental measures may temporarily decrease incoming tourists but are likely to enhance long-term TEXP by fostering sustainable practices. The study concludes that the relationships between environmental sustainability and tourism are country-specific, underscoring the need for tailored environmental policies to ensure sustainable tourism development.
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