The Impact of Economic Variables on the Travel and Leisure Industry of Japan, the USA, Germany, and the UK

Abstract

After the spread of Covid-19 new concepts like social distance and mobility restrictions have become effective. Leisure activity preferences are changed toward in- home activities. These changes can affect the travel and leisure industry and economic changes owing to the Covid-19 pandemic. The study aims to investigate the travel and leisure industry of Japan, the USA, Germany, and the UK regarding economic linkages and Covid-19 impact. The research data covers the 2011-2020 period. The method of panel data analysis is implemented. The share price index of the industry is analyzed as a dependent variable which can be a benchmark for the industry with selected macro- economic factors. Independent variables are gross domestic product growth, consumer price index growth, consumer confidence index growth, share returns, and interest rates. Results support that the industry is highly dependent on economic factors. The interest rate and consumer confidence index growth have positive effects in the long run. In the short run, the effects of interest rates and gross domestic product growth are positive, while consumer price index growth contributes adverse effects. Results prove that the industry is affected by the Covid-19 pandemic, which is harmful in the long run.