Quantile elasticity of international tourism demand for South Korea using the quantile autoregressive distributed lag model

Abstract

Using the quantile autoregressive model, this paper investigates international inbound tourism demand for South Korea and its determinants. In contrast to previous studies which have dealt with the conditional mean only, the authors examine the effects of covariates at various conditional quantile levels. US and Japanese tourism demand are considered for inbound tourism demand. For US tourism demand, the costs of living in Korea and competing destinations have moderately significant negative effects at very high and low quantiles only, while income does not have any significant effect on tourism demand. On the other hand, for Japanese tourism demand, income has significant positive effects at lower quantiles, and living costs in Korea and competing destinations have significant negative effects at higher quantiles. These results address the heterogeneity in tourism demand analysis.