Pandemic‐induced uncertainty and tourism demand: Evidence on the moderator effect of democratic institutions

Abstract

AbstractThis paper explores the mitigating effect of democratic institutions in the nexus of tourism and pandemic‐induced uncertainty in 24 Organisation for Economic Co‐operation and Development (OECD) countries. Utilizing dynamic panel data analysis in the modeling process, the findings reveal that increased pandemic‐related uncertainty in the target market negatively affects the tourism demand. However, the presence of democratic institutions in the destination country positively affects the tourism demand. Finally, democratic institutions help mitigate the negative effects of pandemic uncertainty on tourism demand. The research highlights that a democratic destination can provide a more favorable environment for tourism development amid pandemic uncertainty.