Chinese Outbound Tourism Demand to Singapore, Malaysia and Thailand Destinations: A Study of Political Events and Holiday Impacts

This chapter investigates the effects of Thailand’s political turmoil and the Chinese Spring Festival on the dynamic dependence between the Chinese outbound tourism demand for Singapore, Malaysia and Thailand (SMT) using the bivariate and multivariate dynamic copula-based ARMAX-APARCH model with skewed Student’s t-distribution and normal inverse Gaussian marginals. We selected political events and the Chinese Spring Festival as the forcing variables to explain the time-varying dependences, and also proposed a dynamic multivariate Gaussian copula to capture the dependence between the Chinese outbound tourism demand for Singapore, Malaysia and Thailand. The main empirical results show that Thailand’s political turmoil and the Chinese Spring Festival, respectively, have negative and positive effects on Chinese tourist arrivals to SMT. Also, there does exist a high degree of persistence pertaining to the dependence structure among SMT. In addition, both the lagged one period of Thailand’s political turmoil and the Chinese Spring Festival are found to have a positive influence on time-varying dependences. Lastly, we found that substitute effects exist between Thailand and Malaysia, while complementary effects prevail between Thailand and Singapore, and Singapore and Malaysia. The findings of this study have important implications for destination managers and travel agents as they help them to understand the impact of political events and holidays on China outbound tourism demand and provide them with a complementary academic approach on evaluating the role of dependencies in the international tourism demand model.