Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/259433 
Year of Publication: 
2019
Citation: 
[Journal:] Latin American Economic Review [ISSN:] 2196-436X [Volume:] 28 [Issue:] 1 [Article No.:] 2 [Publisher:] Springer [Place:] Heidelberg [Year:] 2019 [Pages:] 1-19
Publisher: 
Springer, Heidelberg
Abstract: 
Because of the lack of econometric studies in relevance to the link between tourism and renewable energy, the goal of this study is to remedy this lack and to explore the causal relationships between renewable energy consumption, the number of tourist arrivals, the trade openness ratio, economic growth, foreign direct investment (FDI), and carbon dioxide (CO2) emissions for a panel of 22 Central and South American countries, spanning the period 1995-2010. The empirical findings document that the variables under investigation are cointegrated. Short-run Granger causality tests illustrate unidirectional causalities running from: (i) renewable energy to CO2 emissions and trade; (ii) tourism to trade and FDI; and (iii) economic growth to renewable energy and tourism. In the long run, there is evidence of bidirectional causality between renewable energy, tourism, FDI, trade, and emissions. Thus, renewable energy and tourism are in a strong long-run causal relationship. Moreover, long-run estimates for the whole panel and for the three income panel groups considered (Lower Middle, Upper Middle, High) highlight that tourism, renewable energy, and FDI contribute to the reduction of emissions, while trade and economic growth lead to higher carbon emissions. Therefore, attracting foreign direct investment, encouraging the use of renewable energy, and tourism development, particularly green tourism, are good policies for this region to combat climate change.
Subjects: 
Renewable energy
Tourism
Foreign direct investment
CO2 emissions
Panel cointegration
JEL: 
C33
F18
F21
O54
Q42
Z38
Persistent Identifier of the first edition: 
Creative Commons License: 
cc-by Logo
Document Type: 
Article

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