The Effect of Tourism Industry on the Development of Entrepreneurship

Abstract
Nowadays, tourism is considered as one of the most lucrative industries in the world. This industry has been considered as a valuable source for bringing revenues, creating jobs, and developing the infrastructure. Tourism is has a lot of potentials in making new businesses and it can help to develop employment and entrepreneurship. Therefore, this study aims to research the effect of tourism industry on entrepreneurship. Twenty six countries which are similar in the number of tourists have been selected and also an econometric model has been estimated during 2004-2012 by STATA (13). The empirical results state meaningful and positive impact of tourism, international trade, foreign direct investment, openness and education upon development of entrepreneurship.
 
Introduction
Tourism industry is one of the effective factors on employment and entrepreneurship. Tourism can facilitate entrepreneurship development. It can employ a large number of labor force in comparison with other sectors. On the other words, tourism needs more labor force, so it causes the level of employment to be increased.
According to the existing studies upon this matter, in most researches economical openness, international trade and foreign direct investment flows are emphasized on entrepreneurship as one of the most important factors. While, tourist arrival in to a country creates job opportunities. For example, tourist arrival not only increases the demand for handicrafts in a country, but also develops entrepreneurial thought and provides new products based on the taste of international tourists in the society.
Therefore, we can introduce tourism industry as an efficient factor on entrepreneurship. Although, there are a few studies in this context, but none of these studies are not based on economic models. Then, by considering this industry in making money and its role in entrepreneurship improvement, it is worthy to study the relationship between tourism and entrepreneurship.
Hence, we present theoretical concepts in section 2. In section 3, it reviews the relevant literature, and a model specification is raised in Section 4. In section 5,it analyzes the empirical results. Finally, section 6 concludes and represents policy implications.
 
Materials and Method
In this study, the pooled data method is used to answer the research questions. The researchers are able to use cross-section and time series data by using this method. Based on the results of F (leamer) test, the OLS methods has been used to estimate the represented model. The model used in this research is described as:
 
                       
14Entit=خ±i +خ²1Tradeit +خ²2tourexpit +خ²3FDIit +خ²4EFIit +خ²5dGDPit +خ²6 eduit+خ²7Unit +خµit'>
Where, Ent_it  is entrepreneurship, tourexp_it is tourism expenditure, Trade_it is international trade (%gdp), FDI_it is foreign direct investment (%gdp), Ent_it is openness proxy, dGDP_it is economic growth, edu_it is school enrollment (tertiary) and Un_it is Unemployment with tertiary education in country i in year t.
 
Discussion and Results
According to the empirical results, international tourism expenditures have affected positively and significantly the entrepreneurship in which it is a phenomenon that results in expanding entrepreneurship and economic growth. In economic literature the income through tourism industry is classified as an export. Therefore, tourism arrival causes economic motivation by its additive coefficient. Then, tourism is a money making resource that have affected entrepreneurship and economic growth through exchange rate, income increase, employment, balance of payment and fundamental developments. Hence, the development oftourism industry plays a significant role for developing countries which encounterto problems such as high unemployment, exchange rate limitations and single product economy. According to this result 1% increase in international trade results in increasing 34% entrepreneurship of these countries.
In addition, international trade affects positively and significantly the entrepreneurship. Therefore, this hypothesis states that international trade affects directly the entrepreneurship is not rejected. Also, the results show that foreign direct investment has positive effect on entrepreneurship in selected countries.
The coefficient of unemployment is negative and significant and this variable has negative impact on entrepreneurship. The more unemployment causes the more employment opportunities to be decreased. Moreover, the results show that economic growth has no effect on entrepreneurship in selected countries. School enrollment (tertiary) and openness have affected positively and significantly entrepreneurship and it is consistent with theoretical literature. Economic openness and deletion of any limitation on goods and services production, distribution and consumption are important determinant factors for competitive motivations, competitive power, entrepreneurial and investment motivations, reduction of corruption, economical rents and informal sectors. Then, we can conclude that all these factors affect directly and indirectly entrepreneurship.   
 
Conclusions
The research findings show that international tourism and development of trading relations have affected entrepreneurship in selected countries. In addition, education, openness and unemployment have changed significantly the entrepreneurship in selected countries. Furthermore, development of trading relations along with competitiveness result in innovation and higher level of productivity in economic relationships and ultimately it promotes the level of entrepreneurship. Meanwhile, development of economic relations by using different trade models; such as, trade openness provide important lessons for developing countries like Iran about improvement of entrepreneurship.
According to the results, unemployment has decreased the entrepreneurship level. Therefore, policymakers should pay more attention to employment to encourage entrepreneurship and solve unemployment problems.