Capital investment in telecommunications infrastructure and tourist arrivals in developing countries : does the public-private sectors relationship matter?

This study investigates the relationship between capital investment in telecommunications infrastructure (TELCOM) and tourist arrivals in developing countries. Additionally, it examines whether the public-private sectors relationship moderates the effect of TELCOM on inbound tourism. The model is empirically tested for 46 developing countries for the years 2005-2019. Applying system generalized method of moments and dynamic fixed-effects estimators, the results show there is a positive and significant relationship between TELCOM and tourist arrivals. We also find that a stronger relationship between the public and private sectors magnifies the positive effect of TELCOM on inbound tourism. The moderating effect of quality of regulations on TELCOM-tourism nexus is a novel finding, highlighting the important role of governments in creating and implementing sound policies and regulations that permit and promote private sector development.