Forecasting tourist arrivals in Greece and the impact of macroeconomic shocks from the countries of tourists’ origin

Gounopoulos, Dimitrios, Petmezas, Dimitris and Santamaria, Daniel (2012) Forecasting tourist arrivals in Greece and the impact of macroeconomic shocks from the countries of tourists’ origin. Annals of Tourism Research, 39 (2). pp. 641-666. ISSN 0160-7383

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Abstract

This paper generates short-term forecasts on tourist arrivals in Greece and performs impulse response analysis to measure the impact of macroeconomic shocks from the origin country on future tourism demand. We find the ARIMA (1, 1, 1) model outperforms exponential smoothing models in forecasting the direction of one year out of sample forecasts. However, this does not translate into point forecasting accuracy. Impulse response analysis on the impact of unemployment and tourists’ cost of living shocks shows that the source of downside risk to future tourism numbers is limited in scope, magnitude, and duration. Shocks to consumer confidence from the origin countries have no impact on future tourism demand. Our results offer important insights and implications for policymakers and tourist operators.

Item Type: Article
Keywords: tourist arrivals; macroeconomic shocks; ARIMA; Holt’s exponential model with trend; double exponential smoothing; impulse response function
Schools and Departments: School of Business, Management and Economics > Economics
Subjects: H Social Sciences > HB Economic theory. Demography
Depositing User: Catrina Hey
Date Deposited: 09 Sep 2013 16:21
Last Modified: 09 Sep 2013 16:21
URI: http://sro.sussex.ac.uk/id/eprint/45219
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