Demand for Kerala’s International Tourism by the Top Three Source Markets: A Comparative Analysis - Acta Universitatis Sapientiae

Acta Univ. Sapientiae, Economics and Business, 11 (2023) 208–226

DOI: https://doi.org/10.2478/auseb-2023-0010

Abstract. The study examines the role of economy, the environment, and the source country’s tourism seasonality in driving the inflow of tourists into Kerala from the top three source countries, viz. the United Kingdom (UK), the United States (US), and France. The methodology employed is the double-log regression technique. It was found that the income of the source countries was merely moderately and selectively related to the predicted variable, while environmental factors, viz. rainfall of the origin countries and the relative temperature, play a decisive role in shaping Kerala’s international tourism. At the same time, relative prices were relevant in explaining Kerala’s international tourism demand. We conclude that Kerala receives more foreign tourists (especially from the advanced economies in Europe and North America) not because the nominal income of the source markets rises but because Kerala’s destinations remain competitive for the tourists from the top three source markets. While climatic factors provide a background for tourism seasonality, it is argued that lower relative prices remain the primary and active force of tourist arrivals.

Keywords: foreign tourist arrivals in Kerala, economic factors, environmental factors, tourism seasonality, double-log regression