Abstract

Domestic tourism, a crucial sector for the Malaysian economy, has not met revenue expectations in recent years. In 2023, domestic tourism expenditure was RM84.9 billion, significantly lower than the RM103.2 billion recorded in 2019 prior to the COVID-19 pandemic. To address this issue, this study will employ the Autoregressive Distributed Lag (ARDL) method to analyse the relationship between key economic variables such as salaries and wages, GDP performance, and inflation on domestic tourism. By uncovering both the short-term and long-term effects of these economic factors, the study aims to identify which of these factors—salaries and wages, economic growth, or inflation—has the most significant influence on domestic tourism in Malaysia. The findings will highlight the need for targeted interventions to boost domestic tourism. Addressing income disparities and enhancing overall economic stability are crucial for increasing domestic tourism participation and spending. These insights will be invaluable for policymakers and industry stakeholders, enabling them to develop effective strategies to foster a robust and inclusive domestic tourism market. In conclusion, this research underscores the significance of economic factors in shaping domestic tourism trends in Malaysia. The comprehensive analysis provided by the ARDL method offers valuable insights for developing strategies that contribute to Malaysia's economic growth and development by promoting a thriving domestic tourism sector.