Exploring the Relationship Between Tourism Development Indicators and Carbon Emissions: A Case Study of Pakistan

Tourism is viewed increasingly as an essential sector to local, regional and national reconstruction and development for economies at various scales. The objective of the study is to empirically investigate a two-way statistical relationship between the tourism development indicators and carbon emissions in Pakistan over a period of 1991-2010. To recognize this relationship, a time series, co-integration and Granger Causality Tests have been employed. The study further evaluates four alternative but equally plausible hypotheses, each with different policy implications. These are: i) tourism indicators cause carbon emission (the conventional view), ii) carbon emission cause tourism indicators, iii) There is a bi-directional causality between the two variables and iv) both variables are causality independent (although highly correlated). The results reveal that tourism indicators significantly increase carbon emissions in Pakistan. The causality results only moderately support the conventional view that tourism indicators have significant long run casual effect on carbon emissions in Pakistan. The present study find evident of unidirectional causality running between the tourism indicators and carbon emissions on one hand, while causal relationship running from carbon emissions to natural resource depletion and carbon emissions to net forest depletion in the context of Pakistan.