On average, tourism-specialized countries grow more than others. This is not consistent with the core of modern economic growth theory that suggests that economic growth is linked to sectors with high-tech intensity and large scale. In this article, we use appropriate panel data methods to study the relationship between tourism and economic growth. In general, we show that tourism is a positive determinant of economic growth both in a broad sample of countries and in a sample of poor countries. However, contrary to previous contributions, tourism is not more relevant in small countries than in a general sample.

Based on various panel models, we study the profitability determinants of Portuguese service industries. The results obtained show that profitability is persistent over time, and that for larger companies with greater growth, a lower level of debt and lower level of fixed assets are more profitable. Considering the results obtained, we can conclude that diversification of activities and motivation as well as the tendency to innovate contribute positively to increased profitability in Portuguese service industries, whereas the need to pay off debt charges periodically harms profitability. The government would be well advised to create special credit channels that would permit the greater growth of Portuguese service industries, especially those most inclined to innovate.

We analyse the relationship between public debt, economic growth and inflation in a group of 52African economies between 1950 and 2012. The results indicate that the limits of public debt are negatively related to economic growth and exhibit, from a given level of debt, an invertedUbehaviour regarding the relationship between economic growth and public debt. Briefly, the high levels of public debt are coincident with reduced rates of economic growth and rising levels of inflation. Our results for three specific geographical areas resemble those of the overall analysis, despite some differences. InNorthAfrican countries, the growth rates of the gross domestic product (GDP) and inflation also show an invertedUbehaviour as the ratio of public debt/GDPincreases. The highest rate of economic growth is recorded when the ratio of public debt/GDPis below 30% ofGDPand corresponds to an average inflation rate of 5.33%. An identical behaviour of theGDPgrowth rates and inflation also appears in Sub‐Saharan countries until the third interval (60–90%). However, the highest growth rate of theGDPandGDPper capita is registered when the public debt/GDPratio is in the second interval (30–60%). For the countries of theSouthernAfricaDevelopmentCommunity, the highest average rate of economic growth (6.8%) is similar toNorthAfrican countries, when the ratio public debt/GDPis below 30% ofGDP, with an average inflation rate of 11%. A number of robustness analyses were performed and the great majority of them confirm the general analysis.