Asymmetrical Informative Estimation for Macroeconomic Model: Special Case in the Tourism Sector of Thailand

Authors: Chukiat Chaiboonsri, Satawat Wannapan

Abstract:

This paper used an asymmetric informative concept to apply in the macroeconomic model estimation of the tourism sector in Thailand. The variables used to statistically analyze are Thailand international and domestic tourism revenues, the expenditures of foreign and domestic tourists, service investments by private sectors, service investments by the government of Thailand, Thailand service imports and exports, and net service income transfers. All of data is a time-series index which was observed between 2002 and 2015. Empirically, the tourism multiplier and accelerator were estimated by two statistical approaches. The first was the result of the Generalized Method of Moments model (GMM) based on the assumption which the tourism market in Thailand had perfect information (Symmetrical data). The second was the result of the Maximum Entropy Bootstrapping approach (MEboot) based on the process that attempted to deal with imperfect information and reduced uncertainty in data observations (Asymmetrical data). In addition, the tourism leakages were investigated by a simple model based on the injections and leakages concept. The empirical findings represented the parameters computed from the MEboot approach which is different from the GMM method. However, both of the MEboot estimation and GMM model suggests that Thailand’s tourism sectors are in a period capable of stimulating the economy.

Keywords: Thailand tourism, maximum entropy bootstrapping approach, macroeconomic model, asymmetric information.

Digital Object Identifier (DOI): doi.org/10.5281/zenodo.1130967

References:

[1] J. A. Mirrlees, and N. H. Stern, “Fairly good plans” Journal of Economics Theory, Vol.4, 1971, pp. 268-288.
[2] S. Rusu, “Tourism multiplier effect” Journal of Economics and Business Research, Vol.1, 2011, pp. 70-76.
[3] B. Trebicka, “Tourism as a multiplier effect in economy: the case of Albania” International Journal of Business and Management Invention, Vol.5 Issue.1, 2016, pp. 17-21.
[4] E. Horváth, and D. C. Frechtling, “Estimating the multiplier effects of tourism Expenditure on a local Economy through a reginal input-output model” Journal of Traveo Research, Vol.34 No.4, 1999, pp. 324-332.
[5] B. Archer, “The value of multipliers and their policy implications” Tourism Management, Vol.3 No.4, 1982, pp. 236–241.
[6] J. M. Clark, “Business acceleration and the law of demand” Journal of political economy, Vol. 25, 1917, pp. 217-235.
[7] C. Chendroyaperumal, “Keynes’ multiplier and the accelerator principle and the Indian economic thought” Thirukkural, 2009, Available at SSRN: http://ssrn.com/abstract=1424238. Retrieve at 30 August 2016.
[8] J. E. Eklund, “Theories of investment: a theoretical review with empirical application” Swedish Entrepreneurs Forum: Working Paper Series No.22.
[9] L. Cernat, and J. Gourdon, “Is the concept of sustainable tourism sustainable” United Nations Conference On Trade And Development, New York and Geneva, 2007.
[10] M. Boz, “Leakage and value added in international tourism revenues: tourism satellite account as a measurement method” International Journal 0f Business and Social science, 2011, Vol.2 No.24, pp. 198 – 206.
[11] M. A. F. Chowhury and F. M. Shahria, “The impact of tourism a deflect economy: a conceptual model in Bangladesh” Business Intelligence Journal, Vol.5 No.1, 2012, pp. 163-168.
[12] L. P. Hansen, “Large sample properties of generalized method of moments estimators” Economtrica, Vol. 50 Issue.4, 1982, pp. 1029-1054.
[13] G. Tauchen, “Statistical properties of generalized method of moments estimators of structure parameters obtained from financial market data” Journal of Business & Economic Statistics, Vol.4 No.4, 1986, pp. 397-416.
[14] R. Jagannathan, G. Skoulakis, and Z. Wang, “Generalized method of moments: application in finance” Journal of Business & Economic statistics, Vol.20 No.4, 2002, pp. 470-481.
[15] G. W. Imbens, “Generalized method of moments and empirical likelihood” Journal of Business & Economic statistics, Vol.20 No.4, 2002, pp. 493-506.
[16] B. E. Hansen and K. D. West, “Generalized method of moments and macroeconomics” Journal of Business & Economic statistics, Vol.20 No.4, 2002, pp. 460-469.
[17] P. Zsohar, “Short introduction to the generalized method of moments” Hungarian Statistical Review, Vol. 16, 2012, pp. 150-170.
[18] H. D. Vinod, “Maximum entropy bootstrap algorithm enhancements” 2013, Available at SSRN: http://ssrn.com/abstract=2285041 or http://dx.doi.org/10.2139/ssrn.2285041. Retrieve at 15 September 2016.
[19] M. S. Heracleous, A. Koutris, and A. Spanos, “Testing for structural breaks and other form of non-stationary: a misspecification perspective” Working Paper No.17, 2006.
[20] P. Chaitip and C. Chaiboonsri, “AEC’s demand for ICT: maximum entropy bootstrapping in panel data” Procedia Economics and Finance, Vol.5, 2013, pp. 125-132.
[21] D. Dickey and W. Fuller, “Distribution of the estimators for autoregressive time series with a unit root” Journal of the American Statistical Association, Vol.74, 1979, pp. 427-431.
[22] S. Kates, “Keynes, say’s law and the theory of the business cycle” History of Economics Review, Vol.25 No.1, 1996, pp. 119-126.
[23] Department of Tourism of Thailand, “Tourism statistics” 2016, Available at http://www.tourism.go.th/home/listcontent/11/221/276. Retrieve at 5 August 2016.
[24] World Bank Database, “Thailand international tourism revenue” 2016, Available at http://data.worldbank.org/country/thailand. Retrieve at 6 August 2016.
[25] S. Smulders, M. Toman and C. Withagen, “Growth theory and green growth” OxCarre Research Paper 135, University of Oxford, Oxford. Available at http://www.oxcarre.ox.ac.uk/files/OxCarreRP2014135(2) .pdf. Retrieve at 4 November 2016.