Title: Tourism development and poverty reduction in Kenya: a dynamic causal linkage

Authors: Sheilla Nyasha; Nicholas M. Odhiambo

Addresses: Department of Economics, University of South Africa (UNISA), P.O. Box 392, Pretoria 0003, South Africa ' Department of Economics, University of South Africa (UNISA), P.O. Box 392, Pretoria 0003, South Africa

Abstract: The study has examined the causality between tourism development and poverty reduction in Kenya – one of the top tourism destinations in Africa – during the 1980–2016 period. As a way of addressing the bias associated with the omission of variables, investment was the third variable used, alongside tourism development and poverty reduction, to create a trivariate Granger-causality setting. In addition, the recently introduced ARDL bounds testing approach was used within an error-correction model framework to examine this linkage. The empirical results show that tourism development and poverty reduction Granger-cause each other in Kenya, but only in the short run. In the long run, no significant causal relationship was found to exist between these two variables. Based on these findings, policy makers and relevant authorities in Kenya are recommended to consider both pro-poverty-reduction and tourism-enhancing policies in order to reduce poverty and boost its inbound tourism.

Keywords: poverty reduction; tourism development; tourism policy; Granger-causality; Kenya.

DOI: 10.1504/IJTP.2019.104889

International Journal of Tourism Policy, 2019 Vol.9 No.3, pp.222 - 234

Received: 19 Oct 2018
Accepted: 24 Jul 2019
Published online: 05 Feb 2020 *

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