Forecasting US air travelers to Europe, Caribbean and Asia

Travel and tourism are among the most important economic contributors to most, if not all, countries. According to the World Tourism Organization (WTO), the number of international arrivals showed remarkable growth, from 25 million international arrivals in 1950 to 699 million in 2000. This indicates an average annual growth rate of 7%. In the same period, tourism receipts recorded an average annual growth rate of 11%. In 2002, international tourism generated worldwide receipts of US$474 billion, corresponding to US$1.3 billion a day or US$675 per tourist arrival. In view of the important role that international tourism plays in the global economy, this research applied four time-series forecasting techniques to project the trend of US air travelers, a major source market, to Europe, Caribbean and Asia, the three leading outbound markets (second to Canada and Mexico) from the US in the period 2003-2005. Experimental outcomes reveal declining trends. This paper discusses the underlying factors for such trends. Lastly, this paper ends with a detailed discussion on policy implications.