The impact of relative prices on tourism demand for Mauritius: An empirical analysis

Figures & data

Figure 1: Percent share of tourism in GDP, 1988–2014.

Source: Bank of Mauritius Annual Reports (www.bom.mu).

Figure 2: Tourist arrivals, 1974–2012.

Source: Central Statistics Office (www.statsmauritius.gov.mu).

Figure 3: Tourism receipts, 1974–2012.

Source: Central Statistics Office (www.statsmauritius.gov.mu).

Figure 4: Percent distribution of tourist arrivals by country of residence, 2001–12.

Table 1: Long-run estimates

Variable	β (average pricecomp)	β (pricecomp, Seychelles)	β (pricecomp, Maldives)
	1	1	1
	0.45**	0.54**	0.51*
	1.16**	1.03**	1.19**
	0.64*	0.55*	0.63*
	−0.316**	−0.42*	−0.37*
	0.28*	0.38*	0.22**
	−0.11**	−0.15***	−0.13*

*Significant at 10%.

**Significant at 5%.

***Significant at 1%.

Table 2: Estimates of the error correction model

Variable	Δtr	Δgdph	Δgdpf	Δrooms	Δrelative	Δpricecomp
	0.313*	0.34*	0.16	0.17*	0.11*	0.24
	0.26**	0.446**	0.143	0.13*	0.06*	0.07
	0.375*	0.24**	0.37***	0.21*	0.12	0.21
	0.24**	0.24*	−0.16	0.57**	0.08	0.11
	−0.24*	−0.165*	−0.25	−0.18**	0.25*	0.12
	0.11	0.12*	−0.31	0.13*	−0.17	0.37**
	−0.65***	−0.125	−0.26**	−0.57*	−0.61*	−0.57***
	0.72	0.72	0.52	0.61	0.74	0.43

*Significant at 10%.

**Significant at 5%.

***Significant at 1%.

Table A1: Summary results of unit root tests in level form: augmented Dickey & Fuller (ADF) and Phillips & Perron (PP) tests

Variable (log)	Lag selection	ADF	PP	Variable type	ADF (time trend (t))	Variable type
tr	0	+0.24	+0.62	I(1)	−1.87	I(1)
gdph	1	−0.15	−0.94	I(1)	−1.68	I(1)
gdpf	0	−0.27	−0.79	I(1)	−1.39	I(1)
room	1	1.334	1.68	I(1)	1.95	I(1)
relative	1	−1.43	−1.67	I(1)	−1.97	I(1)
pricecomp	1	+1.62	+1.44	I(1)	−1.42	I(1)

Table A2: Summary results of unit root tests in first difference: augmented Dickey & Fuller (ADF) and Phillips & Perron (PP) tests

Variable (log)	Lag selection	ADF	PP	Variable type	ADF (with time trend (t))	Variable type
Δtr	0	−5.22	−6.72	I(0)	−4.55	I(0)
Δgdph	0	−4.76	−5.23	I(0)	−4.64	I(0)
Δgdpf	0	−4.87	−6.55	I(0)	−5.33	I(0)
Δroom	0	−3.45	−5.45	I(0)	−434	I(0)
Δrelative	0	−3.44	−4.86	I(0)	−3.43	I(0)
Δpricecomp	0	−4.87	−6.43	I(0)	−4.44	I(0)

Table A3: Co-integration test result from Johansen procedure

	Null hypothesis	Alternative hypothesis	Test statistic	Critical value 5%	Critical value 10%
Maximal eigenvalue of the stochastic matrix	r = 0	r = 1	45.14	40.65	37.34
	r ≤ 1	r = 2	29.38	34.34	31.84
	r ≤ 2	r = 3	24.69	28.34	25.86
	r ≤ 3	r = 4	17.34	22.76	19.32
	r ≤ 4	r = 5	11.43	15.34	13.12
	r ≤ 5	r = 6	6.87	9.18	7.43
Trace of the stochastic matrix	r = 0	r ≥ 1	104.87	102.34	97.43
	r ≤ 1	r ≥ 2	69.14	75.66	71.43
	r ≤ 2	r ≥ 3	44.97	53.23	49.43
	r ≤ 3	r ≥ 4	28.34	34.43	31.87
	r ≤ 4	r ≥ 5	16.76	20.75	17.97
	r ≤ 5	r = 6	5.34	9.65	7.59

Notes: Johansen maximum likelihood procedure of co-integrating regression. tr = (gdph,gdpf,room,relative,pricecomp): number of co-integrating vectors(s) using the co–integration likelihood ratio.