2007年-世界发展银行全球_Can_Foreign_Lobbying_Enhance_Development__The_Case_of_Tourism_in_the_Caribbean_25页_410kb

Summary of the Document: "Can Foreign Lobbying Enhance Development? The Case of Tourism in the Caribbean"

Core Content

This paper investigates whether foreign lobbying can serve as an effective tool for promoting tourism and, consequently, economic development in the Caribbean. It is the first empirical study to explore the potential of foreign lobbying as a development mechanism. The authors use panel data to analyze the relationship between foreign lobbying expenditures by Caribbean principals and U.S. tourist arrivals, focusing on the economic impact of lobbying on tourism demand.

Main Viewpoints

• Foreign Lobbying Mechanism: Foreign lobbying in the U.S. is primarily informational, aimed at influencing policymakers and public opinion to promote trade and tourism. While direct campaign contributions are prohibited under the Foreign Agents Registration Act (FARA), lobbying activities can include media engagement, dissemination of information to legislators, and efforts to improve the image of Caribbean destinations.

• Impact of Lobbying on Tourism: The study finds a strong positive association between foreign lobbying and U.S. tourist arrivals. Using a fixed-effects model, the elasticity of tourism with respect to foreign lobbying is estimated to be 0.032, implying a 10% increase in lobbying leads to a 0.32% increase in arrivals. Instrumental variables (IV) estimates further support this, with an elasticity of 0.296, suggesting a 15% increase in arrivals for a doubling of lobbying expenditure.

• Economic Mechanism: The paper explores the potential for lobbying to reduce the price elasticity of tourism demand. By improving information and perceptions about the safety and quality of Caribbean destinations, lobbying can make tourism less sensitive to price changes, thereby increasing its economic impact.

• Policy Implications: The findings suggest that foreign lobbying can be a useful tool for developing countries to enhance tourism, which in turn can promote economic growth. This is particularly relevant for small, low-to-middle income countries where tourism is a major export sector.

Key Information

• Legal Framework: The Foreign Agents Registration Act (FARA) of 1938 provides a legal channel for foreign principals to lobby U.S. policymakers indirectly through U.S.-based agents. FARA requires all lobbying activities to be reported.

• Data and Methodology: The authors use panel data from 13 Caribbean countries (1991–2000) and FARA reports to quantify the impact of lobbying on tourism. They estimate both fixed-effects and random-effects models, with the latter incorporating gravity variables (distance, land area, etc.).

• Sample Characteristics: The study includes countries such as Aruba, Barbados, Cayman Islands, Jamaica, and Trinidad and Tobago. These countries account for 38% of total Caribbean tourist arrivals and 32% of U.S.-Caribbean tourism during the 1990–2000 period.

• Lobbying Expenditure: The total foreign lobbying expenditure by Caribbean countries during the 1990–99 period was approximately $306 million. The data includes information on the type of lobbying activities, the amount spent, and the countries involved.

• Endogeneity and Instrumental Variables: To address potential endogeneity, the authors use the external asset positions of reporting banks as an instrument. This financial variable is correlated with lobbying expenditure but not with the error term in the tourism regression, making it a suitable instrument.

• Gravity Model: The gravity model is used to assess the relationship between tourism flows and economic and geographic variables. The model suggests that distance negatively affects tourism, while land area has a positive effect. The inclusion of lobbying as a variable in the gravity model further confirms its impact on tourism.

Conclusion

The study concludes that foreign lobbying can significantly enhance tourism in the Caribbean, thereby contributing to economic development. The results support the idea that lobbying can reduce the price sensitivity of tourism demand and increase the number of tourist arrivals. These findings have important policy implications for developing countries seeking to leverage foreign lobbying as a strategy to promote tourism and economic growth.

Key Variables and Equations

• Model Equation:
  $$
  \mathrm {L T O U R I S T S} _ {i t} = \beta \mathrm {L L O B} _ {i t - 1} + \alpha_ {1} \mathrm {L P C G D P} _ {i t} + \alpha_ {2} \mathrm {L R E R} _ {i t} + c _ {i} + u _ {i t}
  $$

  • LTOURISTS: Log of U.S. tourist arrivals
  • LLLOB: Log of tourism-related foreign lobbying spending
  • LPCGDP: Log of real per capita GDP
  • LRER: Log of real exchange rate
  • ci: Country fixed effects
  • uit: Unexplained tourism shocks

• Gravity Model: Includes variables such as distance, land area, and language (COMLANG), alongside lobbying and GDP. The model is used to assess the role of economic and geographic factors in tourism flows.

Additional Notes

• Sensitivity Analysis: The authors conduct various sensitivity analyses to confirm the robustness of their findings.
• Empirical Novelty: This is the first paper to empirically examine the potential of foreign lobbying as a development tool, particularly in the context of tourism.
• Theoretical Support: The study draws on Copeland’s (1991) theory, which suggests that tourism can improve welfare by increasing the prices of non-tradable goods and promoting economic growth through appropriate redistribution of gains.

Policy Relevance

• Tourism as a Development Tool: Tourism is a major export sector for many Caribbean countries, and lobbying can help increase its volume and economic impact.
• Informational Lobbying: The emphasis on informational lobbying rather than direct campaign contributions highlights the strategic importance of public relations and policy advocacy in promoting tourism.