Tourism industry has been an important contributor to the Malaysian economy. This study attempts to identify the important factors of demand for tourism to Malaysia. The income, relative prices, and exchange rate elasticities for demand of tourism to Malaysia by US citizens are estimated. In general, all three variables have the proper signs and statistically significant. In addition, the estimated tourism demand model reveal that the effect of relative prices dominate those of income and exchange rate. This finding has important implication for both the government and investors in Malaysia.
