The tourism sector is the backbone of the economy in the Special Region of Yogyakarta Province. The COVID-19 pandemic has shown DIY's vulnerability to shocks in the tourism sector. The drastic decline in tourist visits during the pandemic resulted in a decline in PAD. This study examines the effect of the tourism sector on Local Government Revenue (Pendapatan Asli Daerah, PAD) in the Special Region of Yogyakarta (DIY) using an annual panel dataset from 2018 to 2024 across five districts/cities in DIY. The independent variables include the number of tourist attractions, number of visitors, number of hotels and accommodations, and number of restaurants, while the dependent variable is the PAD value in billion rupiahs. A panel regression method was employed, and the Random Effect Model (REM) was selected based on the results of the Chow test, Hausman test, and Lagrange Multiplier test. The analysis reveals that the number of hotels and accommodations has a positive and significant effect on PAD, whereas the number of tourist attractions has a negative and significant effect. The numbers of visitors and restaurants show positive but statistically insignificant effects. These findings recommend strengthening accommodation management and improving the quality of tourist attractions as strategies to support PAD growth in DIY through the tourism sector.
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