Title : THE INFLUENCE OF THE TOURISM SECTOR ON ECONOMIC GROWTH IN INDONESIA
Author: Anggita Permata Yakup,
Universitas Airlangga
Item Type : Thesis (Thesis)
Abstract
The tourism sector has an important role as a source for foreign exchange revenue, and can encourage national economic growth, especially in reducing the number of unemployment and increasing the productivity of a country. The tourism sector is one of the strategic sectors that must be utilized for tourism development as part of national development. Tourism development has a final goal to increase community income which in turn can improve the welfare of the community and economic growth. The development of tourism also encourages and accelerates economic growth. Tourism activities create demand, both consumption and investment which in turn will lead to production activities of goods and services. This study examines the effect of tourism on economic growth in Indonesia based on time series data during 1975 - 2017. This study uses a simultaneous equation model estimated with two stage least square. The results show that tourism has a positive effect on economic growth and vice versa economic growth has a positive effect on tourism. Another factor that influences tourism in Indonesia is the exchange rate and inflation. Tourism can increase foreign exchange income, create jobs, stimulate the growth of the tourism industry, therefore it can trigger economic growth, especially can encourage in various countries to develop the tourism sector. Tourism contributes to economic growth through various channels including foreign currency income, attracting international investment.
Keywords: Tourism, Economic Growth, Two Stages Least Square
