Examining the tourism-induced environmental Kuznets curve hypothesis for India

Abstract

This paper revisits the debate on the possible impact of tourism sector development on carbon emissions using annual time series data from 1980 to 2019. The present study is a pioneering attempt to estimate the threshold point for tourism-induced environmental Kuznets curve (EKC) for India. For this purpose, the autoregressive distributive lag model and block-exogeneity Granger non-causality test have been employed. The empirical results confirm a long-run cointegrating relationship between tourist sector development, real GDP per capita, energy consumption, urbanization and carbon dioxide (CO2) emissions in India. The results also indicate a positive and significant association between the tourism sector, economic growth, and carbon emissions in the long run and support the tourism-induced EKC hypothesis in India. Further, the study finds a long-run and short-run causal nexus between the variables. The findings also emphasize the need to rely less on the use of fossil fuels and instead transition to green energy production in the tourism industry. Given the size of the tourism industry in India, such practices would make a meaningful contribution to inclusive and sustainable development in the country.