Economic Growth Led Tourism: with Special Reference to State Sikkim

Abstract

This study is an attempt to analyse tourism leading to economic development in the state of Sikkim. This study has obtained time series data of foreign tourist arrivals to Sikkim for the time period 1994-2014. The focal point of the study is to find out the causality between income and tourists visits to Sikkim. To discern the causality, this study uses statistical tools like unit root, Johansson's Co integration test, Vector error correction modelling and impulse response function. Results from this study suggest that there is unidirectional causation where economic growth leads to tourism and not the other way round.