Factors Affecting Demand for Tourism in Middle Eastern Countries: Spatial Econometric Panel Data Approach

Tourism is one of the sources of economic growth and sustainable employment in various countries, which accounts for a large share of global income. As one of the largest industries in the world, tourism plays an important role in the national economies. Identifying the economic factors affecting the entry of foreign tourists can help policymakers to improve or maintain the status quo. Therefore, the purpose of this study is to investigate the economic factors affecting demand for tourism in selected countries of the Middle East by spatial econometric panel data approach during the period of 1990-2016. The results indicate that exchange rate, per capita income and economic freedom have positive and significant effects on demand for tourism. In addition, the impact of spatial proximity on demand for tourism is significant among the countries under study. In other words, geographical distance is a major factor in demand for tourism.