Determinants of Tourism Development in Developing Countries: A Bayesian Econometric Approach

]Since tourism is increasingly developing in all over the world, it is focused more than before by most economists and policy makers. Accordingly, in order to make appropriate policies to improve tourism, investigating the determinants of tourism demand is very important. According to the literature, there are a lot of possible variables which their effects on tourism demand in different economies have been emphasized by previous studies. Therefore, using the data obtained from Iran Provinces and applying Bayesian Model Averaging (BMA) method, this study tried to investigate the determinants of tourism demand in developing countries during 1995-2012. The results showed that the population of destination (as an index showing the size of market) and GDP (development index) are the most important variables which affect tourism demand. In addition, the variables related to infrastructures, communication facilities, international trade, quality of life and human capital (education and health) have positive effects on tourism development. On the contrary, some variables like high relative prices and poor quality of life such as pollution have reducing impact on tourism demand. According to the results, it is suggested to improve transport infrastructure, develop an efficient human capital by improving education and health status, and reduce pollution in cities.