This study examines how exchange rates and global uncertainty interact to shape international tourism demand across G20 economies. Using annual data from 2001 to 2023, we apply a PMG-ARDL framework, complemented by heterogeneity and panel quantile regressions, to identify long-run relationships and distribution-specific responses. The results show that per capita income is the dominant long-run driver of tourism demand, while the positive effects of currency depreciation weaken substantially under elevated uncertainty. Moreover, we document a systematic divergence between advanced and emerging destinations: advanced economies preserve their exchange-rate advantages during uncertain periods, whereas emerging markets experience an erosion of price competitiveness. These findings suggest that exchange-rate-based strategies alone are insufficient to sustain tourism demand in volatile environments without macroeconomic stability and institutional resilience.
Helhel et al. (Sat,) studied this question.