Author(s): Kunofiwa Tsaurai
The objectives of this study were twofold: Firstly, to investigate the impact of tourism on poverty alleviation in upper middle-income countries. Secondly, to find out the influence of the complementarity between tourism and economic growth on poverty alleviation in upper middleincome countries. The study used dynamic GMM approach econometric estimation tool with panel data ranging from 2003 to 2016. Earlier research on the influence of tourism on poverty reduction produced mixed results and never focused on upper middle-income countries, which mainly over rely on tourism to turn around its economic fortunes. The study introduced financial development in order to deal with the missing variable bias. Using all the three proxies of poverty, this study noted that the vicious cycle of poverty exists in the case of middle-income countries. Both tourism and financial development individually reduced poverty in upper middleincome group of countries, in line with available literature. As predicted, the complementarity between tourism and financial development had a significant impact on poverty reduction under all the three measures of poverty used in this study. Upper middle-income countries are therefore urged to develop and implement policies that concurrently enhances both tourism and financial development in order to significantly reduce poverty.