This study investigates a long-run relationship among tourism, trade openness and economic growth, and the direction of causality among them using ARDL approach for Quarterly data from 1980:Q1 to 2013:Q4 in Malaysia. The results demonstrate that tourism, trade openness and economic growth are cointegrated; on the other hand, a long run relationship can be inferred among these three variables. The results of Granger Causality test also imply that economic growth stimulates international trade and international tourist arrivals to Malaysia. Also, growth in international tourism stimulates economic growth, thus there is abi-directional relationship between them. The results show that unidirectional causality between Trade and GDP, Trade and tourism. Furthermore, exchange rate also stimulates in international tourist arrivals trade and economic growth in Malaysia. Thus, policies should be promote and increase international tourism demand and provide and foster the development of tourism supply so that the GDP can be increased resulting in a higher growth in Malaysia.
