Supply side sentiments and international travel: a novel dynamic simulation of policy options for business and investor sentiments

Adamolekun, Gbenga; Adedoyin, Festus Fatai; Ozturk, Ilhan

Abstract

The tourism literature widely documents how emotions, mood and optimism drive the demand for tourism. However, the literature is mute on whether sentiment plays a role in the supply side. We use a forward-looking forecasting model to investigate the interplay between various sentiment measures and travel. The simulation robustly accounts for the effect of trade, real GDP, and foreign direct investment on travel services. The result shows a long-term relationship between travel services and customer sentiment, hence, an increase in the bull-bear spread (BBS), in the short run, has a negative influence on travel services, but this link fades in the long run. Consumer confidence, on the other hand, has a positive impact on travel services in both the short and long run. Our findings advocate the consideration of sentiments when modelling travel services export. The forecasting model also reveals that travel services will decline in the future.

Citation

Adamolekun, G., Adedoyin, F. F., & Ozturk, I. (in press). Supply side sentiments and international travel: a novel dynamic simulation of policy options for business and investor sentiments. Journal of Policy Research in Tourism, Leisure and Events, https://doi.org/10.1080/19407963.2022.2142235

• Journal Article Type: Article
• Acceptance Date: Oct 27, 2022
• Online Publication Date: Nov 9, 2022
• Deposit Date: Nov 10, 2022
• Journal: Journal of Policy Research in Tourism, Leisure and Events
• Print ISSN: 1940-7963
• Electronic ISSN: 1940-7971
• Publisher: Routledge
• Peer Reviewed: Peer Reviewed
• DOI: https://doi.org/10.1080/19407963.2022.2142235
• Keywords: Tourism, travel services, forecasting, investors’ sentiment, business – sentiment
• Public URL: http://researchrepository.napier.ac.uk/Output/2952102