Tourism Product Life-Cycle, Growth, and Environmental Sustainability

This study examines the relationship between carbon dioxide (CO2) emissions and gross domestic product (GDP) in the tourism industry, using annual time series data from 1955 to 2019 for Greece and 1930 to 2019 for Italy. The Autoregressive Distributed Lags (ARDL) model was used to determine the threshold point at which the tourism-induced Environmental Kuznets Curve (EKC) emerges in each stage of tourism, as indicated by the Tourism Area Life Cycle (TALC) model. The existence and direction of causality between CO2 emissions, GDP, and tourist arrivals was determined using the Toda–Yamamoto Granger causality test. The analysis emphasizes the complex relationship between economic growth, environmental degradation, and the tourism industry. The EKC hypothesis is supported by empirical findings that show a strong long-term cointegration between tourist arrivals, GDP, and CO2 emissions. This suggests that, while tourism growth initially contributes to environmental degradation, it also fosters conditions for sustainable development as economies progress, providing critical insights for policy-makers seeking to promote environmentally sustainable tourism.