Lead-lag effects associated with Incremental Historical Volatility of Inbound Tourism of South Korea depending on Military Threat Types by DPRK

Lead-lag effects associated with Incremental Historical Volatility of Inbound Tourism of South Korea depending on Military Threat Types by DPRK

This study is the fourth of a series of research looking at various effects between military threats of Korean Peninsula and the relationship of inbound tourism using an Incremental Historical Vdlatility(IHV) method. This trial is focused on lead-lag effects on IHV to find out optimal lag times. Consequently, Lag 3 is suggested rather than Lag 2 or Lag 4. This means that foreign tourists had responses to the military threats not in real-time, but three months later in the data, which the ripple effect subsequently approached to pick within three months after the events. Nonlinear regression model has shown more goodness of fit curve, in particular with Quadratic and Compound. Historical volatility has strengthened in order to analyse each of these historical events and measuring the sizes of their effects. This exploratory study could be one of a process of developing a new forecasting model based on historical volatility that is more adopted to tourists9 fear gauge as well as accuracy issues in time series, especially in incremental uncertain political situations. This study is designed to support the importance of the relationship between growth of tourism and regional peace on the Korean Peninsula.