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Abstract
The present study examines the impact of physical economic development proxied by road density, air transport facilities, tourism infrastructure measured in terms of availability of hotels, and crime activities on the arrival of foreign visitors, domestic visitors, and revenue receipts from tourism in 25 Indian states using a state-level panel data covering the period 1995–2011. The empirical estimate reveals that economic development, world heritage sites and availability of hotels significantly increase inflow of foreign and domestic visitors in Indian states. However, crime activities adversely affect the inflow of foreign and domestic tourists in short run, while major terror attacks do not significantly impact tourist arrivals. Finally, the estimates from IV-Tobit model show that road density, availability of land check post facility and government expenditure on the tourism industry leads to a significant increase in tourism receipts.
Acknowledgements
We would like to thank Prof. B. N. Goldar, Mr. Jagadish Sahu and two anonymous reviewers for giving their valuable suggestions and comments. Special thanks are also due for Mr. Shailesh Kumar, Deputy Director, Ministry of Tourism, Government of India, for facilitating the process of data collection. Any remaining errors are ours.
Notes
* This paper was presented in a conference on ‘Papers in Public Economics and Policy’ held at National Institute of Public Finance and Policy (NIPFP), New Delhi on 23–24th March 2017.
1. Rashtriya Barh Ayog (RBA), has estimated state-wise liable to flood-prone area (see page no 18, Planning Commission, GoI, Citation2011).
2. There are 32 world heritage sites in India.