Is tourism conducive to green growth? An investigation of the role of tourism-based economic expansion in the nexus of leisure tourism and business tourism

Purpose The gradual expansion of the tourism sector is raising concerns about whether tourism-based economies are conducive to supporting green growth. Hence, the current study aims to analyze the direct impact of tourism motives on green growth along with the indirect impact of tourism-based economic expansion while controlling for country risk and renewable energy. Design/methodology/approach An unbalanced panel data for a sample of 21 countries comprising OECD and non-OECD economies are employed for the analysis. Findings Regression results reveal that leisure tourism (LT) significantly and positively influences CO 2 intensity compared to business tourism (BT). Propensity score matching results show that the most traveled tourist destinations contribute more to CO 2 intensity than those less traveled. Mediation analysis by employing Baron and Kenny’s three-step regression, Sobel’s test and Monte Carlo test shows that tourism-based economic expansion significantly mediates between the nexus of LT and CO 2 intensity. Practical implications Results of the study provide useful practical implications for sustainable economy and green growth. It recommends to mitigate the challenges of LT, reducing the negative impact and to harness the potential of BT, enhancing the positive influence, through various policies and practices. Originality/value This study is the first to examine the impact of LT and BT on green growth, to explore the role of destination popularity and the mediating role of tourism-based economic expansion in this relationship.