arrivals in the first six months of 2013 were 4 per cent higher than the previous year (World Bank 2013).
Keely and Kess (2013) identify tourism as one of the rapidly and largest growing industries in the world and for emerging economies is a necessary division of a developing countries economic development and imperishable in terms of growth emanating from its labour intensity (Swarbrooke, 1999). The sustainability of tourism is improved when combined with a stable currency and a conducive exchange rate which makes products appear less expensive for tourists.
Kabote, Chimutingiza and Mirimi, (2013) conducted a study to determine the impact of dollarization on the tourism industry in Zimbabwe. Their variables of interest were: overseas and regional arrivals; tourism receipts and the average spent per tourist; and room occupancy and bed occupancy. For their methodology, they chose a descriptive comparison of means before and after dollarization. Significantly, Kabote et. al (2013) make no attempt to make further analysis to determine the statistical significance of their findings.
This study differs from theirs in several respects: firstly the following macroeconomic variables - inflation and GDP per capita were studied. Secondly, a more rigorous methodology was employed such as analysis of variance (ANOVA), regression analysis and Pearson’s correlation to analyse(explain) the impact of dollarization on tourism and poverty in Zimbabwe before and after dollarization at the 95 per cent significance level. Thus the current study extends Kabote et. al. (2013) study by also investigating the impact of dollarization on poverty and whether inflation had an impact on tourism arrivals and revenue.
The literature demonstrates that dollarization brings certain benefits to an economy that chooses that path whether by official decree or by popular demand of the masses. However, the literature also points out those things/issues which require attention so that the benefits can be quickly felt throughout the economy. Tourism is one such matter requiring attention and with the ability to provide livelihoods. At the same time tourists are fickle. Any sign of conflict, human suffering and they will stay away. So peace and stability, prudent food security so that famine may not darken the threshold of households is a condition precedent.
3. Methodology
The purpose of this study is to assess the changes in tourism arrivals and revenue, as well as poverty (with GDP per capita as proxy) before and after dollarization in Zimbabwe. The entire period (EP) of study is 1990-2013, which is further divided into two priods: before dollarization (BD) 1990-2008 and after dollarization (AD) 2009-2013 Analysis of variance (ANOVA) will be employed to determine whether there are any significant differences between groups on some variable. In practice the ANOVA is a useful tool for explaining
observations. Its use in this case is justified because two periods are the subject of study i.e.