Annals of Tourism Research 97 (2022) 103491

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Annals of Tourism Research

journal homepage: https://www.journals.elsevier.com/annals-of-
tourism-research

Evaluation of the Integration Policy in China: Does the Integration

of Culture and Tourism Promote Tourism Development?
Yu Jin a,⁎, Haonan Xi a, Xuhui Wang b, Xin Ren a, Libin Yuan a
a
School of Statistics, Dongbei University of Finance and Economics, Dalian 116025, China
b
School of Business Administration, Dongbei University of Finance and Economics, Dalian 116025, China

a r t i c l e i n f o a b s t r a c t

Article history: In recent years, the Chinese government has been introducing policies to promote the integra-
Received 6 February 2022 tion of culture and tourism. This study uses panel data from 31 provinces in China and exam-
Received in revised form 21 September 2022 ines whether these integration policies have promoted China's tourism development.
Accepted 25 September 2022
Methodologically, it treats the introduction of integration policies as a quasi-natural experi-
Available online 13 October 2022
ment and draws on a time-varying difference-in-differences model. The results show that inte-
Associate editor: Gang Li gration policies can significantly increase tourism performance. Moreover, there is a threshold
effect: when economy or urbanization is developed, the positive effect of integration policies
on domestic tourism is inhibited. In addition, when relaxing the assumptions regarding the
Keywords:
policy durability, the findings show that the effects of integration policies are lagged.
Integration of culture and tourism
Time-varying difference-in-differences © 2022 Elsevier Ltd. All rights reserved.
Moderating effect
Regional heterogeneity

Introduction

Tourism plays a pivotal role in the national economy and has been one of the fastest growing industries (Li, Chen, Li, & Goh,
2016). Previous research has indicated that tourism can stimulate economic growth, increase residents' income, promote indus-
trial restructuring, and improve the employment environment (Durbarry, 2002; Lanza, Temple, & Urga, 2003; Seetanah, 2011).
Numerous studies have emphasized the non-economic function of tourism in improving social skills, spiritual enjoyment, and
well-being (Bimonte & Faralla, 2012; Zheng, Liang, Ma, Liu, & Wu, 2022). The role of tourism in increasing the balance of pay-
ments and contributing to the economic globalization has also been highlighted (Balaguer & Cantavella-Jordá, 2002; Sugiyarto,
Blake, & Sinclair, 2003).
Since its reform and opening up, China's tourism has dramatically changed and has received increasing attention from the gov-
ernment (Wen, 1997; Zhang, Chong, & Ap, 1999). However, owing to inefficient management systems and insufficient govern-
ment financial and backward regulatory assessments, China's tourism has no longer been able to meet the growing demands
of both domestic and international tourists in recent years (Liu, Li, Kang, & Zhao, 2018; Zhang & Xu, 2007). Thus, the Chinese gov-
ernment has undertaken a massive reform in regard to tourism (Weaver, Tang, & Zhao, 2020; Xia & Xu, 2018). Numerous studies
have suggested that tourism reform not only needs to improve service capacity but also should seek external resources such as
China's historical tradition and ethnic culture and stimulate their potential in tourism projects (Huang & Wen, 2021; Ying &
Zhou, 2007). Existing studies have shown that the integration of culture and tourism is the most effective path for China's tourism
development (Apostolakis, 2003; Dai, 2019; Fan, 2019).

⁎ Corresponding author.
E-mail addresses: jinyudc@dufe.edu.cn (Y. Jin), wangxuhui@dufe.edu.cn (X. Wang).

https://doi.org/10.1016/j.annals.2022.103491
0160-7383/© 2022 Elsevier Ltd. All rights reserved.
Y. Jin, H. Xi, X. Wang et al. Annals of Tourism Research 97 (2022) 103491

Since 2009, the Chinese government has been introducing various policies to encourage the integration of culture and tourism.
In August 2009, the former Ministry of Culture and the former National Tourism Administration jointly issued the “Guidance on
Promoting the Integration of Culture and Tourism,” which proposed the promotion of the integration of culture and tourism, ex-
ploration of the collaboration of industries, and creation of a new environment for tourism development. From that point until
2018, 25 provincial governments have introduced local integration policies. With the formation of the Ministry of Culture and
Tourism in March 2018, the integration of culture and tourism has sparked much discussion in both government and academia,
with people paying increasing attention to policy effects and wondering whether the integration of culture and tourism has effec-
tively promoted tourism development.
When evaluating integration policies, the central question is to identify the causal effect of policy intervention. If simply com-
paring the outcome before and after the intervention, the findings would not be adequate or robust, and one could not assert the
real impact of the integration policies (Deng, Hu, & Ma, 2019). The difference-in-differences model is a more rigorous model for
policy intervention analysis. However, there have been only a few attempts to apply the difference-in-differences model to the
tourism field. The traditional difference-in-differences model can only work with samples receiving the treatment at the same
time, which is inconsistent with the methodology of this study, and the applicability of the model is, therefore, restricted
(Callaway & Sant Anna, 2021). This study represents an initial attempt at applying the advanced time-varying version of the
difference-in-differences model to evaluate the dynamic effects of a tourism policy. In general, this study seeks to explore the fol-
lowing research questions:
1. Can integration policies contribute to tourism development?
2. Does economic development have an impact on the implementation of integration policies?
3. Has the integration policy had a heterogeneous impact on different provinces?
This study contributes to the literature in three respects. First, it explains the impact of integration policies on domestic and
international tourism development and expands the theoretical boundaries of how economic development affects policy effective-
ness. Second, based on the research design and data characteristics, it employs a more advanced time-varying difference-in-
differences model to evaluate tourism policy intervention and incorporates a parallel trend test and a placebo test to ensure
the robustness of the findings. Third, this study further reveals the causes of policy effectiveness in the moderation analysis by
identifying the interference of economic development. As such, it enriches the literature on tourism policy evaluation by empha-
sizing regional heterogeneity in the effects of policy interventions. In addition, the findings provide a good reference point for gov-
ernment departments to formulate and implement effective tourism policies.

Literature review

The integration of culture and tourism

Since the concept of cultural tourism was introduced, an increasing number of studies have focused on the relationship be-
tween culture and tourism (Mcintosh, 1977). The literature has emphasized that earlier cultural tourism emerged from the devel-
opment and operation of cultural resource, such as heritage tourism, religious tourism, and folklore tourism (Ruiz Ballesteros &
Hernández Ramírez, 2007). Thanks to changes in technology, increasing productivity has made it possible for more cultural re-
sources to enter the tourism market, such as theme parks and film culture (Connell, 2012; Hu et al., 2021).
Tourism is a way for people to gain a more comprehensive understanding of the world and discover themselves (Mccain &
Ray, 2003). Culture is the sum of human spiritual activities and behaviors in a certain region and includes material production,
language, writing, and human relations (Zhou, Zhang, & Edelheim, 2013). As such, culture in tourism represents the cultural con-
tent that is offered by tourism products to tourists to meet their learning and research demands (Butcher, 2013; Helgadóttir,
2014). It involves transforming cultural heritage into tourism competitiveness and broadening the channels for spreading regional
culture (Lee & Bai, 2016; Liu, 2019). The integration of culture and tourism involves the combination of elements and industrial
chains among interrelated industries (Kumar & Dhir, 2020; Li, 2020). Owing to technological change, the boundaries between in-
dustries are blurring, thus leading to industrial integration (Legewie, 2000; Tao & Zhou, 2015). Research has emphasized that from
an industrial perspective, culture and tourism are closely linked based on their respective characteristics. Specifically, tourism has
both economic and cultural attributes; it is the carrier for the value of cultural creativity. On the other hand, culture not only has
ideological characteristics but also has commodity attributes, which can create value in a reasonable business model (Guo, Cao, &
Zhu, 2022; Moon & Song, 2015; Richards, 2018). There is sufficient evidence to show that if the mechanism between industries is
different, it will lead to industrial barriers, making integration difficult (He & Duan, 2021; Jin & Wang, 2020).
The literature helps explore the impact of the integration of culture and tourism in terms of the following aspects. Generally,
industrial integration increases technological demand, promotes industrial innovation, and objectively contributes to productivity
improvement (Gambardella & Torrisi, 1998; Wernz, Thakur Wernz, & Phusavat, 2014). The integration of culture and tourism
means that the traditional tourism sector adopts more cultural elements in tourism projects, which requires the introduction of
technologies and, therefore, facilitates industrial innovation (Quaglione, Crociata, Agovino, & Iaia, 2020; Wu, Lin, & Wang,
2020). There is compelling evidence of the relationship among technological change, increasing productivity, and tourism devel-
opment, which leads to the positive effect of the integration of culture and tourism (Bano, Liu, & Khan, 2022; Nguyen, Natoli, &
Divisekera, 2021).
The market also plays an important role. Because tourism projects attract tourists by establishing a competitive advantage, the
market mechanism of survival of the fittest in the highly competitive tourism market drives companies to innovate in order to

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Y. Jin, H. Xi, X. Wang et al. Annals of Tourism Research 97 (2022) 103491

gain a greater advantage (Kubickova & Martin, 2020; Natalia, Clara, Simon, Noelia, & Barbara, 2019). The integration of culture and
tourism is likely to help create cultural brands in tourism projects and enhances their competitive advantage (Richards & Wilson,
2006). In the long run, cultural branding also contributes to enhancing the cultural soft power of tourism projects, preserving the
originality of tourism projects, and slowing their marginalization (Lee & Chang, 2008; Zhang & Zhu, 2020).
Thanks to the economic development, residences' living standards have improved considerably, and tourists are no longer
merely enjoying the natural scenery; rather, they are paying more attention to the spiritual enjoyment offered by the destination
(Lin, Mao, & Song, 2015). For tourists seeking nostalgia and cultural identity, culture is a key component of a destination's appeal
(González Santa-Cruz & López-Guzmán, 2017). The integration of culture and tourism may potentially meet the diversified, indi-
vidual, and high-quality cultural consumption needs of tourists, which is conducive to expanding their consumption portfolio and
providing more benefits to the tourism industry (Dai, 2019; Hughes & Allen, 2005). Additionally, cultural resources provide addi-
tional connotation to traditional commodities, thus increasing the value of tourism products (Dai, Hein, & Zhang, 2019; Song,
Dwyer, Li, & Cao, 2012).
Although it has been well known that culture and tourism are inter-related, and the integration of culture and tourism has
potential positive effects, these positive outcomes should not be taken for granted. The effectiveness of such integration is subject
to various factors such as resource endowment at different destinations, market demand (domestic and international), and effi-
ciency of innovation and technological changes, as discussed above. Moreover, it depends on the effectiveness of relevant policy
interventions. As such, scientific evaluation of such policy interventions becomes necessary to gain empirical insights into the
issue of culture-tourism integration in a real-world context.

Tourism policy and evaluation of policy interventions

The literature on the impact of macro policies on tourism development is rich. In general, numerous studies have suggested
that the increase in tourism performance cannot be achieved without appropriate policies (Deng et al., 2019; Li, Liu, & Song,
2019). The impact of tourism policies on employment is similarly confirmed and is considered to be an intermediate mechanism
for promoting tourism development (Liu, Mao, & Kang, 2020). On the topic of this study, the policies for cultural tourism have
been affirmed to promote tourism development, given the coupling of culture and tourism (Haigh, 2020). The non-economic con-
siderations of tourism policies, such as poverty alleviation, cultural promotion, and public crises, have also been emphasized (Cole,
Wardana, & Dharmiasih, 2021; Pearce, 1998; Tang, 2017).
In addition to reasonable policies, how to implement a policy is another central issue. Researchers describe policy implementation
as the process of translating the ideas into practice and emphasize the impact of political and economic factors on the implementa-
tion of tourism policies (Dredge & Jamal, 2015; Pforr, 2006). Specifically, the literature has indicated that when policy implementa-
tion encounters obstacles, such as the lack of financial resources and governability and the conflict between policies and regional
realities, it leads to a large discrepancy between economic planning and social reality (Dodds, 2008; Lai, Li, & Feng, 2006).
Political factors have been found to impact the implementation of tourism policies. Because the government is the primary
policy planner, economic benefits and the national economic contribution are crucial considerations when developing policies.
Thus, the literature uses indicators that measure tourism benefits to evaluate tourism policies, including tourism receipts and
number of tourists (Wang & Ap, 2013; Wang, Han, & Ma, 2022). Regional resources are also considered to influence policy imple-
mentation. Existing studies indicate that natural resources provide abundant elements for tourism development, which deter-
mines whether tourism policies can be implemented effectively (Ning & Hoon, 2011). Additionally, human resources,
infrastructure, and digital technologies contribute to tourism development and have a positive impact on the implementation
of tourism policies (Krutwaysho & Bramwell, 2010; Liu & Wall, 2005). As culture is characterized by spatial agglomeration and
strongly contributes to cultural tourism development, rich cultural resources are conducive to policy effectiveness (Harrison,
2011; Hou, Huang, & Xu, 2011; Lee, Chen, & Xing, 2022).
The heterogeneity of policy effectiveness has been discussed in the literature. Given that resources and economic development
are essential to the implementation of tourism policy, researchers have concluded that tourism policies are more effective in re-
gions with higher economic development (Deller, 2010; Wu, 2013). However, from the potential of tourism development, it has
also been argued that because the market is more stable in regions with higher economic development, there has been less room
for tourism reform and policy implementation (Ao & Wei, 2006; Yang, 2010). The existing literature affirms that the regional het-
erogeneity of China's economic development, with studies highlighting that the eastern provinces of the country have seen better
development than the western ones (Fang & Huang, 2020; Guo, Mu, Ding, & Ming, 2021).
Recently, researchers have paid increasing attention to the evaluation of macro policies by using econometric methods, and the
difference-in-differences model has been widely applied to this end (Fuest, Peichl, & Siegloch, 2018; Moser & Voena, 2012). The
main purpose of the difference-in-differences model is to capture the effectiveness of policy intervention through the treatment
effect, which is obtained by comparing the average change in the treated group with that in the comparison group (Botosaru
& Gutierrez, 2018). When designing a difference-in-differences study, parallel trend tests and placebo tests are applied to make
the conclusions more robust, and researchers tend to combine the difference-in-differences model with two-way fixed effects
to obtain a more authentic relationship between the results and the economic reality (Liu et al., 2018; Liu et al., 2020). For
other approaches, the combination of the computable general equilibrium model and econometric model has also been used to
evaluate tourism policies to capture the feedback effects among industries (Li et al., 2019; Meng, Siriwardana, & Pham, 2013).
In contrast, because the computable general equilibrium model is applied more often to tourism forecasting, difference-in-
differences has a greater advantage in terms of policy evaluation.

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Y. Jin, H. Xi, X. Wang et al. Annals of Tourism Research 97 (2022) 103491

However, as previously mentioned, a limitation of the traditional difference-in-differences model is that it requires all treat-
ment individuals to receive the policy intervention at the same time. When there is variation in the treatment timing, the tradi-
tional assumption of parallel trends cannot be satisfied (Callaway & Sant Anna, 2021). The time-varying difference-in-differences
model is considered an advanced alternative to evaluate policies with multiple treatment timings and has also been widely ap-
plied in non-tourism policy (Beck, Levine, & Levkov, 2010; Nunn & Qian, 2011). However, it has rarely been applied in tourism
policy evaluations, and it is limited in the applicability of the sample and the parallel trend test (Zhang & Zhang, 2021).
From the analytical design perspective, the past literature provides useful empirical support for this study. However, there are
still some areas to which the current study can contribute. First, the literature has affirmed the role of tourism policies in promot-
ing tourism development, but few studies have provided theoretical foundations for policy implementation and statistical analysis.
Second, many studies have suggested that economic development has a positive impact on tourism policies, while little research
has focused on the negative effects of a stable market and the conflict between modernization and traditional culture. Third, pre-
vious studies have underapplied the time-varying difference-in-differences model, as, in addition to the limitations of the sample
and test, they have rarely considered the lag or short-term effectiveness of policies when designing experiments.
To address the above gaps, this study expands the theoretical boundaries regarding the influence of economic development on
tourism policy and the heterogeneity of policy effects. From an empirical perspective, this study examines the effect of policy in-
tervention using a more advanced time-varying difference-in-differences model and further relaxes the assumptions regarding the
timing associated with the implementation of policies. Finally, this study uses a series of tests to ensure the reliability and robust-
ness of the findings.

Methodology

Research context

To confirm whether the integration of culture and tourism has a positive impact on China's tourism, this study attempts to
provide empirical evidence based on provincial policies. Shandong first introduced integration policy in 2011, emphasizing the re-
lationship between culture and tourism and affirming the positive effect of macro policies on the integration of both industries,
especially on the discovery and preservation of intangible culture. In terms of specific planning, the policy takes the historical cul-
ture of Confucius and Mount Tai as the core and hopes to build tourism projects with provincial characteristics by combining
modern technology, so as to gain more competitive advantages for tourism products.
As of 2018, 25 provinces in China had issued integration policies. In general, the policies all proposed the exploration of cul-
tural resources, building unique tourism projects, and integrating the responsibilities of the cultural and tourism departments.
However, by comparing the characteristics of provincial integration policies, one can indicate that frontier provinces, such as
Xinjiang, Guangxi, and Yunnan, which are rich in cultural resources and have lower economic development, regarded cultural in-
dustries as important support for integration policies and introduced policies with a focus on developing cultural industries.
Southern coastal provinces with higher economic development, such as Jiangsu, Fujian, and Hainan, regarded the integration of
culture and tourism as a new opportunity for tourism development, and paid more attention to the complementary role of culture
to tourism. Provinces such as Beijing, Tianjin, and Shandong attached great importance to the coupling between culture and tour-
ism, with the coordination of industries as the objective of the policy.
Theoretically, the fitness between policies and regional economy significantly affects policy implementation (Dodds, 2008).
Owing to the inequality of China's tourism development, provinces with more developed tourism have a larger and more stable
tourism market (Ji, Tao, Chen, Cheng, & Fu, 2016). For such provinces, the integration of culture and tourism means changing the
existing industrial landscape, which can create resistance to governments and negatively affect their motivation to implement an
integration policy.
The conflict between modernization and traditional culture also strongly affects integration policies. Compared to culture, tour-
ism is much more valued in China as it contributes more to the national economy (Wang & Zeng, 2020). With the rapid economic
development, cities with higher modernization are gradually developing urban tourism, which is based on modern technology
and business models and, therefore, less dependent on cultural connotations (Jansen-Verbeke, 1986; Yu & Zeng, 2019). Because
of the market competition and tourists' purposefulness, urban tourism and cultural tourism are substitutes for each other in
the current tourism market (Yau & Chan, 1990). Additionally, because urban tourism contributes more to fiscal revenues,
which means it has a greater expected return on city building, it significantly impacts government planning (Wang & Ap, 2013).
Given the above discussion, provinces with higher economic development can offer more urban tourism projects, which crowd
out the space for cultural tourism reform. Thus, the implementation of integration policies is influenced by provincial economic
development. When integration policies are subject to greater constraints, they are less effective and have a weaker effect on tour-
ism benefits. As a result, there is greater regional heterogeneity in China's cultural and tourism integration policies.

Method

Methodologically, this study uses time-varying difference-in-differences (or difference-in-differences with multiple time pe-
riods) based on the following regression:

Y s,t ¼ α þ βDs,t þ δX s,t þ μ s þ λt þ εi,t : ð1Þ

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Y. Jin, H. Xi, X. Wang et al. Annals of Tourism Research 97 (2022) 103491

Table 1
Summary statistics.

Variable Mean Std. dev. Min Max

Domestic tourism receipts per capita (per income) 7529.17 5036.75 921.88 27,772.16
International tourism receipts per capita (per income for) 54.67 67.86 0.40 297.82
Domestic tourist arrivals per capita (per tourist) 68,857.73 38,944.68 13,037.07 253,008.90
Foreign tourist arrivals per capita (per tourist for) 1054.31 4208.28 19.28 69,138.17
GDP per capita (per GDP) 46,919.11 23,912.36 12,989.37 151,031.00
Investment in fixed assets per capita (per fix) 36,478.46 15,096.45 8924.75 88,561.26
Number of star-rated hotels per 10,000 people (per hotel) 0.10 0.06 0.03 0.44
Number of cabs per 10,000 people (per taxi) 9.98 7.26 2.43 33.97
Number of museums per 10,000 people (per mus) 0.48 0.27 0.03 1.71
Number of students enrolled in higher education per 100,000 people (Edu) 2501.93 834.53 1082.00 6196.00
Proportion of employment in the tertiary sector (ratio tertiary) 39.16 10.48 20.21 81.21
Landscaping ratio (lds) 38.80 4.13 18.10 49.10
Square of landscaping ratio (lds_2) 1522.23 307.69 327.61 2410.81
Consumer price index (CPI) 116.63 6.96 102.9 132.15
Urbanization rate (urban) 55.56 13.49 22.67 89.60

Notes: I) There are 279 observations for all variables, including 31 provinces, for 9 years from 2010 to 2018. II) The variable town will be used in the subsequent
sections and reported there. III) Data sources: the yearbooks and bulletins published by the National Bureau of Statistics of China and the regional
statistical bureaus.

where Yi, t measures the tourism development in province s in year t, μs and λt account for the province and year fixed effects, Xs, t includes
control variables at the provincial level, εi, t is the error term, and Di, t is the core dummy variable and accounts for whether province s has
issued an integration policy in year t. The coefficient β indicates the impact of the integration policy on tourism development.
Considering that it is controversial to view the integration policies as having a continuous and permanent impact on tourism
development, this study relaxes this assumption and examines whether there is a scenario in which the integration policy causes
shocks in the short term and gradually fails. Specifically, this is done by adding a time threshold τ to model (1) and examining the
effectiveness of the integration policy by introducing a cross-term between threshold τ and Ds, t when it is within the time thresh-
old only, expressed as:

Y s,t ¼ α þ βDs,t  I s,t ðτÞ þ δX s,t þ μ s þ λt þ εi,t , ð2Þ

where I(·) is a schematic function and only when the time is within τ years before the policy, Is, t(τ) = 0, otherwise Is, t(τ) = 1. Dis-
cussions on Eq. (2) will be presented in the robustness test.

Variables and data

The data used in this study are mainly from the yearbooks and bulletins published by the National Bureau of Statistics of China
and from the regional statistical bureaus. Because only 25 provinces explicitly issued integration policies from 2011 to December
2018, data from this period are gathered. The selected variables are as outlined below.
Dependent variables. Given the governments' focus on increasing tourism performance, the dependent variables used in Eq. (1)
include tourism receipts and tourist arrivals. Further, this study takes the per capita of dependent variables and uses the provincial
CPI to deflate them. To better analyze the marginal effect of policies, the logarithms of the variables are used for regression. Addition-
ally, this study examines both international and domestic tourism to assess which is more affected by the policies.
Control variables. The difference-in-differences model has a strict requirement for control variables, which are mainly used to
control for other factors that may influence regional tourism development. When selecting the control variables in Eq. (1), this
study followed the specification that the control variables should have a significant impact on tourism performance and be sup-
ported by the literature as well as that they should satisfy the availability of data.
Existing studies provide a sufficient theoretical background for this study. The relationship between economic development and
tourism has been exhaustively illustrated, and the literature uses GDP per capita as the index to control the economic development
of a province (Rivera, 2017; Sokhanvar, çiftçioğlu, & Javid, 2018). If the service sector is sufficiently developed, it has capacity to bet-
ter serve tourists and, therefore, helps increase the tourism advantage in a competitive market (Koo, Lim, & Dobruszkes, 2017). The
percentage of tertiary sector employment and the number of employees in the transport and accommodation sectors are used to
measure the service capacity of the province (Getz, Anderson, & Sheehan, 1998). As traveling helps foster personal learning, there
are two mechanisms for education that affect tourism: first, with higher education, residents have greater demand for spiritual ful-
filment and cultural content; second, a higher education means more educated young travelers, who are more energetic and have
higher spending capacity (Bueddefeld & Duerden, 2022; Funk & Bruun, 2007).
Given the above discussion, this study uses the (I) GDP per capita, (II) investment in fixed assets per capita, (III) number of
star-rated hotels per 10,000 people, (IV) number of cabs per 10,000 people, (V) number of students enrolled in higher education
per 100,000 people, (VI) proportion of employment in the tertiary sector, (VII) number of museums per 10,000 people, and (VIII)

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Y. Jin, H. Xi, X. Wang et al. Annals of Tourism Research 97 (2022) 103491

Table 2
Main effects of integration policies on tourism.

Model Domestic tourism International tourism Domestic tourist Foreign tourist

receipts receipts arrivals arrivals

(1) (2) (3) (4) (5) (6) (7) (8)

β (Panel A) −0.018 0.003 0.107 0.104 0.020 0.047 0.053 0.047

(0.074) (0.060) (0.108) (0.096) (0.079) (0.064) (0.123) (0.119)
β (Panel B) −0.068 −0.007 0.056 0.082 0.001 0.051 0.072 0.075
(0.096) (0.073) (0.100) (0.064) (0.083) (0.073) (0.163) (0.160)
Time fixed effects No Yes No Yes No Yes No Yes
Regional fixed effect Yes Yes Yes Yes Yes Yes Yes Yes
Control variable Yes Yes Yes Yes Yes Yes Yes Yes
Observations 279 279 279 279 279 279 279 279

Notes: The coefficients of the standard deviations are shown between parentheses below the coefficients in the table. ***, **, and * show significance at the 1 %, 5 %,
and 10 % levels, respectively.

landscaping ratio and its square to control other factors that may affect tourism development in four aspects: economy, culture,
quality of residents, and service capacity. The statistical characteristics of the variables are shown in Table 1.

Empirical results

Basic analysis

The empirical results are calculated by using Stata, and the computer code is available for readers. Table 2 presents the basic
results of Eq. (1), which reflect the relationship between integration policies and provincial tourism development. In Panel A, this
study sets the same year when issuing an integration policy as the effective date. The coefficients are insignificant, suggesting that
the integration policies have not significantly promoted tourism development, and this is valid for both domestic and interna-
tional tourism.
In response to the findings in Panel A, the literature suggests that it may produce a biased estimate when setting the effective
date to the same year as the issuing of policies, given the lags for macro policies (Dutta Roy, 2004; Eicher & Schreiber, 2010). The
integration of culture and tourism, as regional industrial planning, will first adjust industrial structure. Given that the industrial
restructuring takes a long time, policy effectiveness can be delayed. To confirm whether Eq. (1) is accurate, this study sets the
effective date as the first year after issuing policies and re-estimates the model in Panel B. The results show that the adjustment
of the effective date does not affect the estimated results, as all coefficients are still insignificant, which further confirms that the
integration policies did not promote tourism development.

Moderating effect analysis

Theoretical analysis shows that the implementation of integration policies is negatively affected by modernization and eco-
nomic development (Wang & Zeng, 2020). From an empirical perspective, if one simply uses the indicators as the control variable,

Table 3
Results of the moderating effect of regional economic development on integration policies.

Model Domestic tourism International tourism Domestic tourist Foreign tourist

receipts receipts arrivals arrivals

(1) (2) (3) (4) (5) (6) (7) (8)

β (Panel A) 4.877*** 3.617*** 2.212 1.277 4.508*** 3.324*** 4.003 3.963

(0.803) (0.856) (2.685) (2.218) (0.817) (1.098) (3.697) (3.426)
γ (Panel A) −0.459*** −0.340*** −0.197 −0.110 −0.421*** −0.308*** −0.370 −0.368
(0.076) (0.082) (0.247) (0.204) (0.078) (0.104) (0.339) (0.315)
β (Panel B) 0.779*** 0.557*** 0.337 0.266 0.632*** 0.480** 0.587 0.592
(0.210) (0.196) (0.446) (0.389) (0.190) (0.226) (0.476) (0.445)
γ (Panel B) −0.014*** −0.010*** −0.004 −0.003 −0.011*** −0.008* −0.009 −0.009
(0.004) (0.004) (0.007) (0.006) (0.003) (0.004) (0.007) (0.007)
Time fixed effects No Yes No Yes No Yes No Yes
Provincial fixed effect Yes Yes Yes Yes Yes Yes Yes Yes
Control variable Yes Yes Yes Yes Yes Yes Yes Yes
Observations 279 279 279 279 279 279 279 279

The coefficients of the standard deviations are shown between parentheses below the coefficients in the table. ***, **, and * show significance at the 1 %, 5 %, and
10 % levels, respectively.

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Y. Jin, H. Xi, X. Wang et al. Annals of Tourism Research 97 (2022) 103491

Table 4
Division basis of eastern, central, and western regions in China.

Division area Include provinces

Eastern Beijing, Tianjin, Liaoning, Shanghai, Jiangsu, Zhejiang, Fujian, Shandong, Guangdong
Central Hebei, Shanxi, Jilin, Heilongjiang, Anhui, Jiangxi, Henan, Hubei, Hunan, Hainan
Western Inner Mongolia, Guangxi, Chongqing, Sichuan, Yunnan, Guizhou, Tibet, Shaanxi, Gansu, Qinghai, Ningxia, Xinjiang

the coefficients are biased and not robust. Thus, this study introduces a cross-effect in Eq. (1) to examine the role of moderniza-
tion and economic development on policy effectiveness, which is expressed in the following model:

Y s,t ¼ α þ βDs,t þ γDs,t  T s,t þ ϑT s,t þ δX s,t þ μ s þ λt þ εi,t , ð3Þ

where Ts, t indicates the moderating variables in province s in year t.

Table 3 presents the results of the moderating effect. Panel A uses GDP per capita (per GDP) as the moderating term,
while Panel B uses the urbanization rate (urban). The results in Models (1), (2), (5), and (6) show that the coefficients of
integration policies are positive, while the moderating terms are negative, with both being significant. In contrast, the re-
sults in Models (2), (3), (7), and (8) are not significant. From the statistical inference, the results suggest that the inte-
gration policies significantly promote domestic tourism development, while economic development and modernization
inhibit policy effectiveness, which corroborates the hypothesis regarding the influence of economic development on pol-
icy implementation.
In terms of economic implications, one can presume from the coefficients that when GDP per capita and urbanization
rate take the median 33,780 yuan and 53.78 %, respectively, provinces with integration policies are 7.42 %–9.50 % and
1.94 %–2.64 % higher in tourism receipts as well as 11.88 %–12.52 % and 4.12 %–5.10 % higher in tourist arrivals than prov-
inces with no policies. However, when the GDP per capita or urbanization rate increases by 1 %, the differences between
provinces will decrease by 0.34 %–0.46 % and 1.00 %–1.40 % in tourism receipts as well as 0.31 %–0.42 % and 0.80 %–1.10 %
in tourist arrivals. In contrast, the role of policy in tourism receipts is more affected by economic factors.
Through further observations, it can be seen that there is a threshold for policy effectiveness. When GDP per capita exceeds
41,162–41,699 and 44,704–48,640 yuan, the integration policies will no longer have positive effects on tourism, and the same
is true when urbanization rate exceeds 55.64 %–55.70 % and 57.45–60.00 %. Given that the effects of policy on tourism receipts
are more influenced by economic development, it is understandable that the threshold of GDP per capita and urbanization rate
on tourism receipts is lower than that of tourist arrivals.
The integration policies do not have a significant impact on international tourism. The literature suggests that the inte-
gration of culture and tourism has a heterogeneous impact on domestic and international tourists. Because of the differ-
ences in the historical and cultural backgrounds of tourists worldwide, foreign tourists identify less with the cultural
connotations of the destination country and are, therefore, less interested in cultural tourism (Liu et al., 2020). To maximize
tourism utility, international tourists tend to choose urban tourism rather than cultural tourism based on transport and ser-
vice considerations, as international tourism faces higher costs than domestic tourism (Peng, Song, & Crouch, 2014). Addi-
tionally, in the earlier integration, the cultural tourism projects consist mostly of the simple combination of historical
culture and natural scenery, which provides a good daily pastime for local tourists but does not meet the needs of interna-
tional tourists for a representative culture (Bowden, 2006).

Table 5
Results of policy heterogeneity.

Model Domestic tourism International tourism Domestic tourist Foreign tourist

receipts receipts arrivals arrivals

(1) (2) (3) (4) (5) (6) (7) (8)

β −0.264*** −0.149* −0.217 −0.115 −0.158* −0.060 −0.299** −0.258*

(0.091) (0.079) (0.178) (0.139) (0.082) (0.084) (0.147) (0.138)
γ0 0.416*** 0.258*** 0.495** 0.312** 0.299*** 0.170** 0.448** 0.368**
(0.092) (0.082) (0.194) (0.153) (0.079) (0.084) (0.176) (0.159)
γ1 0.280** 0.161* 0.522*** 0.413** 0.210*** 0.147* 0.849** 0.795*
(0.118) (0.092) (0.165) (0.166) (0.073) (0.077) (0.430) (0.467)
Time fixed effects No Yes No Yes No Yes No Yes
Provincial fixed effect Yes Yes Yes Yes Yes Yes Yes Yes
Control variable Yes Yes Yes Yes Yes Yes Yes Yes
Observations 279 279 279 279 279 279 279 279

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Y. Jin, H. Xi, X. Wang et al. Annals of Tourism Research 97 (2022) 103491

A: Estimation of Equation (5)

(I) Domestic tourism receipts (II) Domestic tourist arrivals

B: Estimation of Equation (6)

(III) Domestic tourism receipts (IV) Domestic tourist arrivals

Fig. 1. Results of the parallel trend test.

Regional heterogeneity analysis

To examine whether the integration policies have a heterogeneous effect on regional tourism, this study introduces a regional
cross-effect into Eq. (1), which is expressed as:

Y s,t ¼ α þ βDs,t þ γ 0 Ds,t  D_middles,t þ γ 1 Ds,t  D_west s,t þ δX s,t þ μ s þ λt þ εi,t , ð4Þ

where D_middles,t and D_wests,t are dummy variables. Eq. (4) takes the cross-term of eastern region (i.e.,Ds,t × D_easts,t) as the bench-
mark term and eliminates it. The classification used in Eq. (4) is reported in Table 4.
Table 5 presents the results of the estimation for policy heterogeneity. In terms of domestic tourism, the coefficients β are neg-
ative, and γ0, γ1 are positive, suggesting that the integration policy plays a more significant role in central and western provinces
that in eastern ones. Given that the coefficients γ0 are larger than γ1, it can be concluded that the policies are most effective in
central provinces. From the economic implication of the coefficients, the policy effects in central provinces are 11.52 %–16.42 %
higher than in eastern provinces for tourism receipts and 11.00 %–14.10 % higher for tourist arrivals. When comparing western
and eastern provinces, the difference in policy effects will be reduced to 1.20 %–1.60 % for tourism receipts and 5.20 %–8.70 %
for tourist arrivals. This finding is in line with the above expectation, which has affirmed the moderating effect of economic de-
velopment on policy effectiveness for domestic tourism.
Regarding international tourism, the coefficients in Models (3), (4), (7), and (8) are similar to the results for domestic tourism
but differ in that all γ1 are the highest coefficients. The results confirm the heterogeneity of policy effects on international tourism

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Y. Jin, H. Xi, X. Wang et al. Annals of Tourism Research 97 (2022) 103491

A: Without the moderating term

(I) Domestic tourism receipts (II) Domestic tourist arrivals

B: With the moderating term (based on town)

(III) Domestic tourism receipts (IV) Domestic tourist arrivals

Fig. 2. Results of the placebo test.

and suggest that the policy is most favorable for the western provinces. Compared to eastern provinces, central and western prov-
inces are 21.77 %–32.05 % and 34.72 %–35.66 % higher for tourism receipts as well as 11.63 %–16.07 % and 71.09 %–73.33 % higher
for tourist arrivals. Notably, through the basic and moderating effect analyses, the promotion of integration policies on interna-
tional tourism cannot be confirmed, which contradicts the results in Table 3. The contradiction suggests that the impact of inte-
gration policies on international tourism has been influenced by non-economic development factors. This finding is meaningful for
future research.

Robustness check

Parallel trend test: the dynamics effect of integration policies

Following existing studies (Beck et al., 2010; Fang & Huang, 2020; Nunn & Qian, 2011), this study examines the parallel trend
of the integration policies. The test is based on the following set-up:

−k −ðk−1Þ −1 þ1 þðl−1Þ þl
Y s;t ¼ α þ ϑ−k Ds;t þ ϑ −ðk−1Þ Ds;t þ ⋯ þ ϑ −1 Ds;t þ ϑ 0 Currents; j þ ϑ þ1 Ds;t þ   þϑ þðl−1Þ Ds;t þ ϑ þl Ds;t þ δX s;t þ μ s
þ λt þ εi;t ; ð5Þ

Y s;t ¼ α þ θ−k Di;t þ ^θ−k Di;t  T i þ ⋯ þ θ−1 Di;t þ ^θ−1 Di;t  T i þ ϑ 0 Currenti; j þ ^θ0 Current s; j  T i þ ⋯ þ θl Di;t þ ^θl Di;t  T i
−k −k −1 −1 l l

þ δX s;t þ μ s þ λt þ εi;t ð6Þ

9
Y. Jin, H. Xi, X. Wang et al. Annals of Tourism Research 97 (2022) 103491

where Di,−kt 、Di,+lt and Currenti, j are dummy variables based on the year-by-year effect of the integration policy. Because the
moderating analysis shows that policy effects on domestic tourism are significantly affected by economic development,
cross-effects can be introduced in Eq. (3), which is expressed by Eq. (6).
Panel A presents the estimation of Eq. (5). In Fig. 1(I), the coefficients are all insignificant, while in Fig. 1(II), they are all sig-
nificant; neither of the two results meet the requirements of the parallel trend test for the coefficients. Thus, it can be seen that,
without considering the moderating effects, the results of examining the effectiveness of integration policies are biased. Panel B
presents the estimation of Eq. (6), where the urbanization rate (urban) is used for the moderating variable. In Fig. 1(III), all of
the coefficients ϑ−k are negative and θ+l are positive. Regarding statistical significance, p(D−7 i, t ) = 0.064, and the p-values for
other coefficients ϑ−k are all in the 0.25–0.70 range, while ϑ0, ϑ1, and ϑ2 are within the significant interval. Based on the results,
one can tentatively infer that the dynamic impact of integration policies passes the parallel trend test. Regarding economic impli-
cations, integration policies have a significant promotion effect on domestic tourism in the short term, with the policy effects
reaching their highest level in the third period.

Placebo test
In general, the development of tourism is influenced by multiple factors. Although one can attenuate endogeneity problems by
introducing control variables, it is clearly unrealistic to exhaust all control variables in econometric analysis. To confirm that the
findings are not affected by endogeneity problems, that is, that China's tourism is indeed significantly promoted by the integration
of culture and tourism, this study uses a placebo test, as shown in Fig. 2. The idea of placebo testing is to generate a policy variable
Dfalse inconsistent with the actual situation and replace the real policy variable through random selection. If the integration policy
plays a significant and unbiased role in promoting the development of local tourism, Dfalse will be insignificant (i.e., β ^ ! 0). By
false

repeating this process, one can describe the distribution of β ^ . The results show that all β^
false false are distributed near zero and
roughly obey a normal distribution, which is consistent with the expectation of the placebo test for the coefficients and increases
the rigorous nature of the causal inference logic of this paper.

Relaxing the assumption

The main regression results in the basic analysis show that the integration policies have no significant effects on tourism de-
velopment. To further explore the causal effect, the assumption of a continuous and permanent impact of integration policies is
relaxed. In the robustness test, we first estimated Eq. (2) by making τ = 2, τ = 3, and τ = 4. From the results, one can confirm
that the integration policies are generally ineffective, regardless of how the assumptions are relaxed.
This study also relaxed the assumptions in the moderating effects analysis. From the results, when τ takes 2 and 3, β and γ are
insignificant, which contradicts the results in Table 4. When τ takes 4, β is positive and significant in the models with domestic
tourism as the explanatory variable, and γ is negative and significant, which coincides with the results in Table 4. The results in-
dicate that the promotion of integration policies on tourism development has a certain lag, which is in line with the results ob-
tained by the parallel trend test.

Conclusions and policy implications

Faced with the fact that tourism is gradually failing to meet national demand, China has been committed to reforming its tour-
ism to better promote its contribution to the national economy. From both a theoretical and practical perspective, the integration
of culture and tourism has become an inevitable trend in tourism development. The literature affirms the positive impact of the
integration policies on Chinese tourism, but only a few studies have discussed this topic from the perspective of implementation.
This study explains how integration policies have been influenced in their implementation, with the central issue being the ap-
plicability of integration policies.
In terms of empirical research, this study is among the initial attempts to employ a time-varying difference-in-differences
model to evaluate the effectiveness of a tourism policy. This study focuses on the integration policies at the provincial level. Ad-
ditionally, the discussion of policy implementation in the theoretical analysis is validated with moderating effect and regional het-
erogeneity analysis. Further, this study uses a parallel trend test and a placebo test to improve the reliability of the conclusions,
and finally, the association with the duration of policy effects is relaxed.
The main results show that, although integration policies have significantly contributed to the development of domestic tour-
ism, economic development inhibits the effect of policy shocks, which reflects the substitution of urban and cultural tourism in
the current tourism market in China and is confirmed by the regional heterogeneity of integration policies. In contrast, although
the integration policies also exhibit regional heterogeneity in the promotion of international tourism, the difference is not caused
by economic factors. Based on the above findings, the policy implications of this study are outlined below.
First, the current situation of regional development should be considered when issuing relevant policies. Our conclusions indi-
cate that, for provinces with a higher level of economic development, the economic benefits of forcibly promoting cultural tourism
may be limited and even counterproductive. Conversely, the provinces with a lower level of economic development should
strengthen the implementation of the integration of culture and tourism and fully exploit the advantages of regional resource en-
dowments and development potential, thus enhancing economic development.
Second, to promote local tourism, the government should provide adequate support facilities, such as enhancing infrastructure
investment, promoting regional transportation convenience, and strengthening the construction of service teams. Based on the

10
Y. Jin, H. Xi, X. Wang et al. Annals of Tourism Research 97 (2022) 103491

estimation results, the investment in infrastructure, employment in the tertiary industry, and education of residents significantly
affect the development of local tourism. These findings reveal that economic development cannot be solely dependent on the con-
tinuous introduction of policies; it must also depend on the provision of a favorable environment for their implementation.
Third, when the overall economic strength of a province is high, under high economic development, the government should
optimize the layout of cultural industries and innovate cultural products. Despite the integration policies between culture and
tourism having been disrupted by economic development, consumer demand for cultural programs in China's contemporary mar-
ket environment is not necessarily limited to cultural tourism. Therefore, the government should further broaden the cultural
market, provide more and better cultural programs for consumers to choose from, and fully integrate the cultural industry into
China's contemporary business system.
Based on the above discussion, to give full play to the role of the integration between culture and tourism under the high-
quality development of China's economy, it is necessary to introduce relevant supporting policies as well as to choose the right
time and place to effectively ensure the adequate input of various resource elements through a continuous deepening and reason-
able layout, so as to provide a basis for the implementation of the policy.
Finally, this study has several limitations that could be addressed by future studies. The effect of integration policies on
international tourism is influenced by non-economic factors. Due to a lack of space availability, this study did not examine
which factors have significantly affected policy implementation. Thus, it will be interesting for future studies to identify these fac-
tors. Moreover, this study provides a theoretical framework and empirical investigation from a macro perspective. Given that nu-
merous business cases have been used in tourism research (Gui & Tang, 2016; Zhang & Xu, 2007b), future studies can provide
more detailed discussions from a micro perspective.

CRediT authorship contribution statement

Yu Jin: Conceptualization, Funding acquisition, Project administration, Resources, Supervision, Writing – original draft. Haonan
Xi: Methodology, Formal analysis, Writing – original draft. Xuhui Wang: Funding acquisition, Validation, Writing – review &
editing, Supervision. Xin Ren: Software, Visualization. Libin Yuan: Data curation, Investigation.

Declaration of competing interest

This manuscript has not been published or presented elsewhere in part or in entirety and is not under consideration by
another journal. All study participants provided informed consent. We have read and understood your journal's policies, and
we believe that neither the manuscript nor the study violates any of these. There are no conflicts of interest to declare.

Acknowledgements

This study is supported by the grants of National Fund of Philosophy Social Science of China (No. 21AZD122) and National
Natural Science Foundation of China (No. 71972030; 71672026).

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Yu Jin is a professor at School of Statistics, Dongbei University of Finance and Economics. His research areas include national economic accounting and policy evaluation.
Xuhui Wang is a professor at School of Business Administration, Dongbei University of Finance and Economics. His research areas include tourism and distribution in-
dustry.
Haonan Xi is a student at School of Statistics, Dongbei University of Finance and Economics.
Xin Ren is a student at School of Statistics, Dongbei University of Finance and Economics.
Libin Yuan is a student at School of Statistics, Dongbei University of Finance and Economics.

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