Mortgage debt and domestic and outbound travel expenditures: International evidence

We explore the relationship between the mortgage debt of households and their spending on domestic and outbound tourism and travel. We estimate a dynamic panel data model for a sample of 27 countries for 2010-2021, and find evidence for a negative relationship. Hence, we show that in countries where the mortgage per capita is high, residents allocate fewer expenditures on domestic and outbound tourism. We also find that the reduction in outbound tourism spending is more pronounced than the decrease in domestic tourism spending. Our findings can benefit policymakers and firms in the tourism industry by providing the knowledge necessary for creating successful promotional strategies.