International Tourism Demand in Indonesia: Gravity Model Approach
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Date
2019Author
Nahar, Faiza Husnayeni
Adha, Mufti Alam
Ulfi, Izzani
Karimah, Husna
Azizurrohman, Muhammad
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Tourism is considered as big industry which growing up faster compare to other industry in this recent
year. It is reported that Indonesia received approximately 11.5 million of international tourists in 2016.
The government willing to boost up the factors that might contribute more on attracting international
tourist. This study tried to analyse the international tourism demand in Indonesia by gravity model
approach. Besides that, visa-free policy was involved to see the effect of its policy on tourism demand in
Indonesia. Then, exchange rate of origin country is used as a control variable. The data is collected by
many different sources during the period of 2006 to 2016, The study found that all variables are
statistically significant. GDPs origin and destination country and country with visa-free entry have positive
effect to the number of international tourist arrival while the rest which is exchange rate of origin country
and length of distance have negative effect to the international tourists. From the result, it can be
concluded that gravity model in this paper is a good tool for measuring the tourism demand in the case of
tourism demand in Indonesia. Hence, the government needs to promote aggressively to the international
tourist by conducting important events, increasing the number of countries that receive Indonesia visa-free
and maintain the GDP in both origin and destination country.