The Nexus Between Human Development and Tourism

A Panel Estimation Approach

Abstract

This study analyses how tourism affects human development (HD) in ten countries during a twenty-four-year period from 1996 to 2019 using a panel estimation approach. The Human Development Index (HDI) that represents health, knowledge and standard of living was adopted as a dependent variable. Apart from tourist arrivals, the study includes relevant variables such as jobs, government effectiveness and political stability. Findings reveal that tourist arrivals have a weak relationship with jobs, political stability and HDI. Tourism has only a slight impact on HD. Interestingly, political stability has a significant and positive relationship to HD. This suggests that a peaceful and stable political environment improves HD.