Abstract

This study probes the complex interplay between tourism development (TDI), economic growth (GDP), and environmental sustainability, focusing on the ten most influential tourism nations: China, France, Italy, the United Kingdom, Mexico, Germany, Turkey, Spain, the United States, and Russia, covering the time from 1994 to 2023. This study uses feasible generalized least squares (FGLS) and Two-Stage Least Squares (2SLS) together with Driscoll–Kraay (DK) and panel quantile regression (PaQR) to examine the environmental as well as economic effects of TDI combined with trade openness (TOPE), foreign direct investment (FDI), energy prices (EPS), and population density (POPD). All models show that tourism development, indicated by TDI, and economic growth increase carbon emissions, demonstrating these variables’ adverse environmental impact. Energy prices, trade openness, and foreign direct investment lead to decreased emissions because these factors help promote energy-efficient clean technology. Furthermore, GDP growth positively influences TDI, while excessive carbon emissions negatively impact the appeal of tourism. The results indicate the need for sustainable tourism policies and investment in clean energy and green infrastructure, aligned with SDG 9, to foster innovation in energy-efficient practices and infrastructure. The research also supports SDG 13 by advocating climate-resilient tourism models and policies that decouple economic growth from environmental degradation. By adopting various advanced econometric approaches, this study provides strong evidence on the relationship between tourism, the macroeconomy, and environmental results. It offers fresh insights on how to achieve the growth of tourism and climate protection at the world’s top tourist destinations.