Czech Tourism Demand: Modelling and Testing in VARs

In available analyses of tourism in the Czech Republic multivariate macroeconometric models are poorly applied. Usually only statistics summaries and graphical representations are published. This study offers Czech tourism analysis which focuses on investigation of relations and influences between tourism demand and the set of selected macroeconomic indicators. This set includes aggregates representing the economic situation of the analyzed country and also foreign and world indicators that are, under our assumptions, significantly connected with the decision making of the potential tourists (tourism demand) traveling to Czech destinations due to change in costs of their trips. These factors are: oil price, exchange rate and price level in the Czech Republic. For the purposes of mentioned analysis bivariate and multivariate vector autoregression models are specified, Granger causality tests are evaluated and impulse response functions are constructed. The results correspond with our assumption and suggest that an intervention or a shock influencing stated factors can significantly affect the tourism demand.