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Published VersionCC BY-NC-ND V4.0, Open Access
Journal article
Inflation expectations and international travel demand
Annals of Tourism Research, Vol.117, pp.1-4
2026
Abstract
This note incorporates household inflation expectations, which are central to consumption theory but overlooked in tourism economics, into models of international travel demand. Using monthly data on U.S. visitor arrivals to Canada, I find that a 1 % increase in household inflation expectations is associated with a 0.42 % rise in tourist arrivals by air. Land-based tourist arrivals also exhibit a positive association, although the evidence is weaker. No significant effects are detected for same-day travel. Gasoline prices, income, and exchange rates are statistically insignificant. The findings highlight the importance of considering inflation expectations for understanding international travel behavior.
•Inflation expectations are integrated into models of travel demand.•They are positively associated with U.S. tourists arriving in Canada by air.•They do not influence same-day travel.•Tourist arrivals by air have recovered from the sharp decline during the pandemic.•Same-day travel remains below pre-pandemic levels.
Details
- Title
- Inflation expectations and international travel demand
- Authors
- Puneet Vatsa (Corresponding Author) - University of the Sunshine Coast, Queensland, School of Business and Creative Industries
- Publication details
- Annals of Tourism Research, Vol.117, pp.1-4
- Publisher
- Elsevier Ltd
- Date published
- 2026
- DOI
- 10.1016/j.annals.2025.104116
- ISSN
- 1873-7722; 0160-7383
- Copyright note
- © 2026 The Author. Published by Elsevier Ltd. This is an open access article under the CC BY-NC-ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/).
- Data Availability
- Data will be made available on request.
- Organisation Unit
- School of Business and Creative Industries
- Language
- English
- Record Identifier
- 991199950902621
- Output Type
- Journal article
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