Peru is a South American country that is divided into two parts by the Andes Mountains.
The rich historical, cultural and geographic diversity has led to the inclusion of ten
Peruvian sites on UNESCO's World Heritage List. For the potentially negative impacts
of mass tourism on the environment, and hence on future international tourism demand,
to be managed appropriately require modelling growth rates and volatility adequately.
The paper models the growth rate and volatility (or the variability in the growth rate) in
daily international tourist arrivals to Peru from 1997 to 2007. The empirical results show
that international tourist arrivals and their growth rates are stationary, and that the
estimated symmetric and asymmetric conditional volatility models all fit the
data extremely well. Moreover, the estimates resemble those arising from financial time
series data, with both short and long run persistence of shocks to the growth rate in
international tourist arrivals.
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