Does Infrastructure Matter In Tourism Development?

Abstract

This paper investigates the significance of infrastructure as a factor in destination development. The classical demand for international tourism function is extended to include a proxy for infrastructure. An application involving the island of Mauritius is presented whereby total tourist arrivals as well as arrivals from Europe/America, Asia and Africa are modelled. The  findings show that tourists are sensitive to the infrastructure of the island, particularly those from Europe/America and Asia. Tourism infrastructure, income of tourists, distance, and relative prices are important ingredients in their own respect in the tourism demand equation.

Keywords: Infrastructure, Tourism, Dynamic Panel data