Economic Policy Uncertainty and Tourism Nexus Dynamics in the G7 Countries: Further Evidence from the Wavelet Analysis

This study examines the relationship between economic policy uncertainty (EPU) and tourism activities in the Group of Seven countries. The analysis is conducted using continuous wavelets, wavelet coherency and phase-difference based on Granger causality analysis to investigate the relationship between EPU and tourism. Our analyses indicate that the relationship is generally negative but changes over time, displaying low to high-frequency cycles. Moreover, the timing and frequency changes when EPU co-moves with tourism. The results suggest tourism-economic policy uncertainty led-hypothesis and economic policy uncertainty-tourism led hypothesis with worthy policy implications for tourist destinations across the world.