Modelling tourist consumption to achieve economic growth and external balance: case of Croatia

Abstract

Purpose – The purpose of this study is to develop a model able to explain international tourist expenditures (inflows) in Croatia, and domestic tourist expenditures (outflows) abroad. Design – The present study is based on the research of international tourism demand, aimed at describing the behavior of international expenditures concepts applied to the case of Croatia. Methodology –The proposed model is a multiple linear regression model. Findings – The modelling procedure with all tests showed that the multiple linear regression model is adequate for modelling international tourist spending or expenditures. The model of foreign tourism inflows as well as the model of domestic tourism outflows are designed with main macroeconomic variables. Originality of the research – The study provides a model of tourism balance useful to analyze and forecast foreign exchange tourism inflows and outflows on the case of Croatia. The model is applicable and useful to govern tourism policy, international trade policy and economic policy as a whole.