An empirical investigation of tourism-led growth hypothesis in the European countries: evidence from augmented mean group estimator

Due to urbanization and the need for people go from one country another either commercial purpose or tourism, it is therefore important determine extent which tourism contributes growth. This article aims investigate tourism-led growth hypothesis in a sample of 34 European countries utilizing yearly data 1995 2015. The research work makes use 8 indicators, cover different dimensions sector development such as foreign visitors' spending, international tourist arrival. For empirical analysis, study accounts key determinants capital, labor energy (renewable non-renewable) consumption. results common correlated effects (CCE) augmented mean group (AMG) groped-mean estimators confirms that there positive relationship between labour, capital GDP insinuating presence countries. Also, findings FMOLS show changes variables leads proportional change GDP. Specifically, evidence shows indicators play an indispensable role promoting economic development, along with consumption, labor. Sustainable Combating environmental issues associated arrivals, renewable consumption should be encouraged reduce externalities ensure sustainable environments businesses tourists’ arrivals.