Analyzing the asymmetric impact of tourism demand on residents’ happiness: evidence from quantile estimation

Abstract

The extension of the worldwide tourism industry has resulted in a growing interest in understanding the influence of tourism demand on local populations, particularly regarding residents’ happiness. This research investigates how tourism demand affects residents’ happiness in the top 10 nations containing the highest tourist arrivals. Earlier works utilized panel data methodologies for the tourism demand-happiness nexus despite several economies needing to develop such a link individually. On the contrary, this paper uses the Quantile-on-Quantile method, which grants the exploration of time-series reliance in every country separately. The outcomes reveal that tourism demand significantly increases residents’ happiness within particular quantiles of the data distribution across opted nations. The robustness of the QQ estimate is assessed by applying quantile regression and Ordinary Least Squares approaches. Policymakers should tailor tourism development strategies to enhance community engagement, mitigate adverse impacts on residents' quality of life, and promote equitable economic benefits.