Abstract:Notwithstanding the systematic inclusion of an exchange rate variable of some form in studies examining
international tourism flows, hardly any research has been carried out to test for a possible exchange
rate regime effect. Drawing from recent advances in exchange rate regime classifications, this paper
begins to fill this gap by investigating the impact of exchange rate regimes on international tourism
flows. The study employs a system generalized methods of moments (SYS-GMM) estimation for tourist
arrivals on a panel of 27 Organization for Economic Co-operation and Development (OECD) and non
OECD countries for the period 1980e2011. The results identify multiple exchange rate regime effects and
support the importance of maintaining a relatively stable exchange rate to attract international tourist
arrivals.