The Effect of Terrorism and Infrastructure on Tourism Industry: A Case of Pakistan

The purpose of this article is to empirically determine the impact of terrorism and infrastructure on tourism industry of Pakistan. The article answers the questions such as “How terrorism (proxy number of terrorism related incidents) effect on tourism (tourists arrival) in Pakistan? ”and “How infrastructure (% of paved roads) on tourism in Pakistan? ”To answer these questions data on annual tourist's arrival in Pakistan (proxy for tourism), number of fatalities in a year (proxy for terrorism) and percentage of paved roads (proxy for infrastructure) have been collected for 1989 to 2011 and linear regression was applied to find the results. The article finds that terrorism significantly influences tourism in adverse manner and infrastructure positively influences tourism industry in Pakistan. The article will be helpful for policymakers to make corrective measures to improve tourism in Pakistan. It will realize the government to improve infrastructure and to uproot the terrorism for the development of tourism.