A0614
Title: Modeling purpose-driven tourism to India: A Bayesian approach with cross-category dependence
Authors: Amrutha Seshagiri - Indian Institute of Management Bangalore (IIMB) (India) [presenting]
Soudeep Deb - Indian Institute of Management Bangalore (India)
Abstract: Tourism is a key contributor to economic development, playing a significant role in boosting GDP and generating employment. Understanding its determinants can provide valuable insights for policy planning and sectoral growth. Inbound tourism is analyzed in India from 62 countries, focusing on two primary factors: The relative economic strength of tourists' countries and their freedom levels, both in comparison to India. Tourist arrivals are categorized by purpose, which are business, leisure, visiting friends and family, medical, and other reasons, to explore how economic and freedom factors influence each category. As these categories are likely interdependent, a Bayesian modeling framework is employed with an error covariance structure to capture such dependencies. This approach helps account for unobserved factors influencing multiple travel purposes, improving the robustness of our estimates. Results show that relative economic strength and currency exchange rates have a significant positive effect on inbound tourism across categories. However, relative freedom status does not show a statistically significant influence. Strong interdependence is also found between medical visits and visits by the Indian diaspora, suggesting many non-resident Indians return for healthcare. These insights have important implications for tourism promotion strategies, particularly in targeting economically stronger countries and those with large Indian expatriate populations.
