Inflation expectations and international travel demand
Bibliographic Data
| ID | 11232508 |
|---|---|
| Authors | Puneet Vatsa (0000-0001-9239-4446, University of the Sunshine Coast, corresponding author) |
| Year | 2026 |
| Volume | 117 |
| Pages | 104116 |
| Publication date | 2026-03-01 |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | Annals of Tourism Research (JOURNAL) |
| Journal identifiers | ISSN: 0160-7383 • E-ISSN: 1873-7722 |
| Publisher | Elsevier BV (PUBLISHER) |
| DOI | 10.1016/j.annals.2025.104116 |
| OpenAlex | W7118586423 |
| Language | EN |
| References cited | 6 |
This note incorporates household inflation expectations, which are central to consumption theory but overlooked in tourism economics, into models of international travel demand. Using monthly data on U.S. visitor arrivals to Canada, I find that a 1 % increase in household inflation expectations is associated with a 0.42 % rise in tourist arrivals by air. Land-based tourist arrivals also exhibit a positive association, although the evidence is weaker. No significant effects are detected for same-day travel. Gasoline prices, income, and exchange rates are statistically insignificant. The findings highlight the importance of considering inflation expectations for understanding international travel behavior. • Inflation expectations are integrated into models of travel demand. • They are positively associated with U.S. tourists arriving in Canada by air. • They do not influence same-day travel. • Tourist arrivals by air have recovered from the sharp decline during the pandemic. • Same-day travel remains below pre-pandemic levels
Air travel · Consumption (sociology · Demand shock · Exchange rate · Inflation (cosmology · Tourism · Visitor pattern · Aviation Industry Analysis and Trends · Consumer Market Behavior and Pricing · Diverse Aspects of Tourism Research
| Highly cited | No |
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