Abstract

International tourism is a fast growing industry generating half a trillion dollars in annual revenues and accounting for almost 10% of total international trade, and almost half of total trade in services. However, it has so far failed to receive the attention it deserves from mainstream economics. This study has investigated the determinants of international tourism in Malawi by estimating three tourism demand models, one for UK tourist, the other for South African tourist and an aggregate model. This is due to the fact that about 44% of international tourists to Africa come from Europe and about 41% from Africa itself. The study has shown that tourism demand is well explained on the aggregate as compared to the analysis per individual tourist origin. This study has attempted to highlight some of the most important determinants of international tourism in Malawi. According to empirical results, domestic tourism prices have a negative impact on international tourism demand in Malawi; therefore, while efforts are being made by the government of Malawi to improve tourism into the country, more effort is needed by way of having a stable economy with stable price levels. The other determinants of international tourism that have been found to be statistically significant are the income in the origin country, the previous period level of tourist that came to Malawi and the real exchange rate between the Malawi Kwacha and the currency of the tourist origin country.

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School	: School of Law, Economics and Government
Issued Date	: 2006

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