Japan’s Inbound Tourism Boom: Lessons for its Post-COVID-19 Revival
IMF Working Papers, August 21, 2020
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Bibliographic details
- Authors: Anh Thi Ngoc Nguyen
- Published: August 21, 2020
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781513553207.001
Summary
- Review of developments in Japanese inbound tourism and investigation of main determinants of its rapid growth prior to the COVID-19 pandemic.
- Empirical approach: panel autoregressive distributed lag (ARDL) model with data on 34 tourism source markets from 1996Q1 to 2018Q4.
- Main analytic focus: long-run determinants of inbound tourism demand, short-run shocks (natural disasters), and policy implications for the post-COVID-19 revival of Japanese inbound tourism.
Methodology and Data
- Model: panel ARDL.
- Sample: data on 34 tourism source markets.
- Sample period: 1996Q1 to 2018Q4.
Key Findings
- Long-run determinants with significant impacts on Japan’s inbound tourism demand:
- Tourist income.
- Tourism-related relative prices.
- Visa policies.
- Short-run dynamics:
- Natural disasters have had large and prolonged effects on tourism.
- The analysis links these determinants to the rapid growth of inbound tourism in Japan before COVID-19.
Policy Implications (as derived in the paper)
- Policies affecting visa regimes can meaningfully influence long-run inbound tourism demand.
- Managing tourism-related relative prices (for example, through exchange rate considerations and price competitiveness) is important for sustaining inbound tourism.
- Supporting source-market tourist incomes (through broader economic engagement or marketing targeting higher-income segments) can help maintain demand.
- Preparedness and resilience strategies are essential to mitigate large and prolonged short-run impacts from natural disasters.
- Policy design for post-COVID-19 revival should consider the relative importance of long-run determinants (income, prices, visa policy) alongside short-run shock management.
Subjects and Keywords (as listed)
- Subjects: Communicable diseases, COVID-19, Economic sectors, Foreign exchange, Health, National accounts, Personal income, Real exchange rates, Tourism.
- Keywords: Abenomics, Asia and Pacific, attractiveness f, Communicable diseases, COVID-19, Global, inbound tourism, Japan inbound tourism, origin country, panel ARDL, Personal income, Real exchange rates, source market, Tourism, tourism demand, tourism determinants, tourism industry, tourism infrastructure, tourist arrival, tourist number, visa policy, WP.
Source: IMF Working Paper “Japan’s Inbound Tourism Boom: Lessons for its Post-COVID-19 Revival” (Anh Thi Ngoc Nguyen, August 21, 2020).
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- Working Paper