This study examines the impact of tourism demand and financial development on economic growth in five Western Balkan countries over the period 2000–2024. International tourist arrivals are used as a proxy for tourism demand, while domestic credit to the private sector represents financial development. Gross capital formation and labour force participation are included as control variables. To investigate the short-run and long-run relationships among the variables, the study employs a panel econometric framework comprising cross-sectional dependence tests, first- and second-generation panel unit root tests, panel cointegration tests, and the Pooled Mean Group Autoregressive Distributed Lag (PMG-ARDL) estimator. The Mean Group (MG) and Dynamic Fixed Effects (DFE) estimators are also estimated, while the Hausman specification test is used to select the preferred estimator. This study contributes to the tourism–finance–growth literature by providing updated panel evidence for five Western Balkan countries and by simultaneously examining tourism demand and financial development within a comprehensive PMG-ARDL framework. The results reveal significant cross-sectional dependence and confirm the existence of a stable long-run equilibrium relationship among the variables. The Hausman test supports the PMG estimator. The PMG-ARDL results indicate that tourism demand, financial development, gross capital formation, and labour force participation positively and significantly influence economic growth. Furthermore, the error-correction term is negative and significant, indicating that approximately 19.1% of short-run disequilibrium adjusts toward long-run equilibrium annually. The findings support the Tourism-Led Growth Hypothesis and highlight the importance of tourism development and financial sector expansion in promoting sustainable economic growth in the Western Balkan countries. JEL Classification: O40; Z32

This study investigated the tourism–economic growth nexus in the United Arab Emirates from 1995 to 2023 using VECM and ARDL models to capture long- and short-run dynamics. Structural breaks in 2008, 2015, and 2020, identified through Zivot–Andrews and Bai–Perron tests, account for major economic transitions associated with the global financial crisis, oil-market adjustment, and the COVID-19 shock. VECM results reveal three long-run cointegrating relationships among economic growth, real tourism receipts, gross capital formation, FDI, and oil rents, with heterogeneous adjustment toward equilibrium. ARDL results confirm a long-run relationship, with tourism receipts, gross capital formation, FDI, and oil rents positively associated with economic growth. Short-run results similarly indicate positive associations across these determinants. However, Granger causality results show that economic growth predicts real tourism receipts, while tourism receipts do not significantly predict economic growth, indicating a growth-led tourism perspective rather than tourism-led predictive causality. Structural-break interventions further demonstrate the importance of major economic shocks in shaping the tourism–growth relationship. The study contributes by integrating VECM, ARDL, Granger causality, and structural-break analysis within a resource-rich and rapidly diversifying Gulf economy. Overall, the findings highlight tourism, investment, FDI, and diversification as interconnected components of sustainable economic growth in the UAE.