Analysis reveals significant bidirectional causality between tourist inflows and corruption in Brazil and Mexico.
The present study examines the causal nexus between tourist inflows and corruption in Brazil and Mexico. Multivariate cointegrated error-correction models are employed to assess the bi-directional nature of short- and long-run Granger-causality. Our results support the contention that causality between tourist inflows and corruption is significantly bidirectional, both in the short- and long-run. Although long-run causality between the variables is significantly bidirectional in Mexico, short-run causality is only unidirectional from tourist inflows to corruption without feedback. A prolonged productive cycle of “sanding the wheels” is supported in Brazil whereby less corruption causes higher tourist inflows and in turn, lowers corruption.
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Darrat et al. (2025) studied this question.
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