Tourism-Led Growth Without Spillovers? Evidence from Domestic Tourism in Bali

Abstract

The dependence of destination regions on the tourism sector does not always guarantee equitable economic growth across regions, particularly when tourist activities are concentrated in core destinations. This study examines the impact of domestic tourism on regional economic growth and the potential for spatial spillover effects across regencies/cities in Bali during the period 2019–2025. Using a spatial panel econometrics, this study finds that an increase in domestic tourist travel has a positive and significant effect on local GRDP growth. However, the estimation results do not indicate a robust spatial spillover effect on neighboring regions. This finding suggests that the growth of domestic tourism in Bali is still spatially concentrated and has not yet fully generated integrated regional development. This study emphasizes the importance of strengthening inter-destination connectivity, cross-regional collaboration, and more inclusive tourism planning to promote equitable regional economic benefits.