Our study is linked to the strand of the literature dealing with renewable energy consumption and tourism. There is a rich and interesting literature concerned by studying renewable energy consumption and its interactions with other interesting variables like pollution emissions, non-renewable energy consumption, international trade and gross domestic product (Al-mulali et al. 2014; Apergis and Payne 2010a, b, 2011, 2012, 2014; Ben Jebli and Ben Youssef 2015a, b; Ben Jebli et al. 2015b; Dogan 2016; Menegaki 2011; Menyah and Wolde-Rufael 2010; Ocal and Aslan 2013; Sadorsky 2009a, b; Shafiei and Salim 2014; Tugcu et al. 2012).
Sadorsky (2009b) considers a panel of 18 emerging countries and shows the absence of short- and long-run causal relationships between output and renewable energy consumption. However, in the long run, increasing output increases renewable energy consumption. Tugcu et al. (2012) compare renewable and non-renewable energy sources in the G7 countries (i.e., Canada, France, Germany, Italy, Japan, UK, and US) to decide which type of energy is more important for economic growth. In the case of a classical production function, they find bidirectional causality between economic growth, renewable and non-renewable energy consumption for all considered countries. Ocal and Aslan (2013) study the causal relationship between renewable energy consumption and output in Turkey. They document that renewable energy consumption has a negative impact on output, while they show the presence of unidirectional causality running from output to renewable energy consumption.
Al-Mulali et al. (2014) study the impact of renewable and non-renewable electricity consumption on economic growth by considering 18 Latin American countries. Their results highlight the presence of long-run bidirectional causality between economic growth, renewable and non-renewable electricity consumption, capital, labor, and trade. In addition, they show that renewable electricity consumption is more significant than non-renewable electricity consumption in promoting economic growth both in the short- and in the long run. Apergis and Payne (2014) explore the determinants of per capita renewable energy consumption for a panel of seven Central American countries. They show the presence of long-run cointegration between per capita renewable energy consumption, economic growth, carbon emissions, real coal prices, and real oil prices. Ben Jebli and Ben Youssef (2015b) consider a panel of 69 countries and show the presence of short-run unidirectional causality running from renewable energy consumption to trade (exports or imports). There is also long-run bidirectional causality between trade and renewable energy consumption. Long-run parameter estimates suggest that renewable energy consumption, non-renewable energy consumption, and trade have a beneficial impact on economic growth. Mert and Bölük (2016) examine the impact of FDI and renewable energy consumption on CO2 emissions by considering an unbalanced panel of 21 Kyoto countries. In the long run, FDI and renewable energy consumption reduce carbon emissions. Thus, their findings support the ‘‘pollution haloes hypothesis’’ which states that FDI brings in cleaner technologies. However, the inverted U-shaped environmental Kuznets curve (EKC) hypothesis was not supported.
Our study is also related to the strand of the literature dealing with tourism. There is a growing literature concerned for tourism and its causal relationships with other economic variables, such as economic growth, energy consumption, CO2 emissions, urbanization, and foreign direct investment (Balaguer and Cantavella-Jordá 2002; Belloumi 2010; Dogan et al. 2017; de Vita et al. 2015; Dristakis 2004; Gunduz and Hatemi-J 2005; Katircioglu 2009a, b, 2014a, b; Katircioglu et al. 2014; Lee and Brahmasrene 2013; Ozturk et al. 2016).
Katircioglu (2009a) investigates the tourism-led-growth (TLG) hypothesis for Turkey by employing the bounds test and Johansen approach for cointegration. He does not find any cointegration between tourism and economic growth, while he concludes that the TLG issue still deserves further attention from researchers for comparison purposes. Belloumi (2010) studies the relationship between tourism receipts, the real effective exchange rate, and GDP growth in Tunisia, spanning the period 1970–2007. He shows the presence of long-run unidirectional causality running from tourism receipts to economic growth. In addition, increasing tourism receipts increase GDP in the long run. Finally, he suggests that a policy relying on tourism to generate economic growth seems to be convenient for Tunisia.
Lee and Brahmasrene (2013) consider a panel of 27 nations of the European Union (EU) and use panel cointegration method and fixed-effect models to investigate the presence of long-run equilibrium among tourism, carbon dioxide emissions, GDP, and foreign direct investment. Increasing tourism, emissions, and FDI increase output. In addition, increasing GDP leads to higher CO2 emissions, while increasing tourism and FDI reduce CO2 emissions. They conclude that when policy-makers make important efforts to attract international tourists, for instance through marketing campaigns, both the economy and the environment benefit. De Vita et al. (2015) find that international tourist arrivals, GDP, squared GDP, energy consumption, and CO2 emissions cointegrate for the case of Turkey. In the long run, tourist arrivals, GDP, and energy consumption have a positive impact on CO2 emissions, while the inverted U-shaped EKC hypothesis is supported. They suggest that despite the environmental deterioration coming from more tourism, policies aimed at environmental protection should not be conducted at the expense of TLG.
Dogan et al. (2017) explore the long-run dynamic relationship between CO2 emissions, GDP, the square of GDP, energy consumption, trade openness, and tourism for the case of Organization for Economic Co-operation and Development (OECD) countries. In the long run, increasing energy consumption or tourism increases CO2 emissions, while increases in trade openness lead to environmental improvements. They show the presence of unidirectional causality running from tourism to CO2 emissions, energy consumption, and trade, and from GDP to tourism. They recommend to OECD policy-makers to impose policies in favor of environmental protection and to encourage the use of cleaner technologies in the tourism sector. Ozturk et al. (2016) examine the EKC hypothesis using the ecological footprint as an ecological indicator and GDP from tourism as an economic indicator. They establish an environmental degradation model for 144 countries. They show that the number of countries having a negative relationship between the ecological footprint and its determinants (i.e., tourism, energy, trade, and urbanization) is relatively more important in the upper-middle- and high-income countries. In addition, the inverted U-shaped EKC hypothesis is more present in the upper-middle- and high-income countries. They recommend implementing ecological footprint and taxes for energy conservation in the tourism sector to reduce the tourism environmental pressure.
To the best of our knowledge, Ben Jebli et al. (2015a) was the first paper studying the dynamic causal relationships between tourism and renewable energy consumption, more precisely combustible renewables and waste consumption. They employ the autoregressive distributed lag (ARDL) approach to investigate the causal relationship between GDP, combustible renewables and waste (CRW) consumption, CO2 emissions, and international tourism for the case of Tunisia. They show the presence of short-run unidirectional causality running from GDP and CRW to international tourism, while there is long-run bidirectional causality between all considered variables. Long-run parameter estimates indicate that CRW consumption increases international tourism, while both CRW consumption and international tourism increase CO2 emissions and GDP. These authors recommend that Tunisia should use more CRW energy, because this contributes to eliminate wastes from touristic zones, while it increases both the number of tourist arrivals and GDP. Our contribution in the present paper comes from studying the dynamic interaction between renewable energy and tourism and their long-run impact on CO2 emissions using dynamic panel cointegration methods and a panel of Central and South American countries.