USK Conferences, The 14th AIC 2024 on Social Sciences

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The Tourism Sector in Indonesia: A Nonlinear Quantile Regression Approach
Aliasuddin Aliasuddin, Faisal Faisal, Ernawati Ernawati, Nanda Rahmi

Last modified: 2024-11-03

Abstract


The tourism sector is a key driver of Indonesia's economy, with significant backward and forward linkages. This study employs a nonlinear quantile approach to examine the sector, with the dependent variable being the tourism sector's contribution to gross domestic product (GDP), and the independent variables are the US GDP, exchange rate, and the number of tourists. The use of a nonlinear model in this study means that all classical linear regression assumptions are no longer valid. One of the testing tools that can be used in this model is the confidence interval. The confidence interval results show that all coefficients are within the appropriate limits. The results show that the tourists and the exchange rate positively and significantly affect the tourism sector, whereas the US GDP has a negative and significant effect on the tourism sector of Indonesia. This means that with the increase in foreign income, the number of tourists to Indonesia could decrease because there is a possibility that tourists will prefer other countries. The role of the US GDP in influencing Indonesia's tourism sector is complex, and further research is needed to fully understand its impact . The government should improve supporting facilities to increase tourism attractiveness in Indonesia so that more foreign tourists come to Indonesia.


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