Microsoft Word Lopez Cordova sg1 + elc (002). docx

---

Policy Research Working Paper

9147

Digital Platforms and the Demand  

for International Tourism Services 

Ernesto Lopez-Cordova 

Finance, Competitiveness and Innovation Global Practice 

February 2020

---

Produced by the Research Support Team

Abstract

The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development 

issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the 

names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those 

of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and 

its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent.

Policy Research Working Paper 9147

Tourism is an important source of foreign exchange and 

employment across developing economies. A scant litera-

ture has explored the relationship between tourism and the 

advent of the internet. This paper contributes to the tour-

ism-trade literature and studies the empirical relationship 

between international tourism and the adoption of digital 

technologies that facilitate search about tourism oppor-

tunities across countries. It links foreign visits with the 

spread of the use of the internet in sending countries and 

the level of development of business-to-consumer digital 

tools in host countries. The paper estimates a well-speci-

fied gravity model of tourist arrivals between country pairs 

with panel data. The results indicate that frictions affecting 

bilateral tourism flows have been attenuated by the advent 

of digital tools. The absolute value of the effects of bilateral 

geographic distance, language differences, and border-con-

tiguity seem to be reduced by the use of the internet by 

potential tourists and the business sector in host countries. 

The results are robust to alternative proxies for internet use 

for tourism search proxied by data from Google trends. The 

paper also presents simulations of the potential impacts of 

advances in the adoption of digital tools over time, linking 

the adoption process to mechanisms of technology adop-

tion that are commonplace in the literature. 

This paper is a product of the Finance, Competitiveness and Innovation Global Practice. It is part of a larger effort by the 

World Bank to provide open access to its research and make a contribution to development policy discussions around the 

world. Policy Research Working Papers are also posted on the Web at http://www.worldbank.org/prwp. The author may 

be contacted at [e-mail].     

---