The influence of environmental factors on outbound tourism has been investigated profusely by tourism researchers. However, the possible non-linear effect of environmental degradation on outbound tourism is yet to be explored. In this study, the emission of CO2 into the air is argued as a gradual process and as such, it is possible that the effect on outbound tourism will be positive until a maximum emission level is reached. Focusing on Nigeria, how CO2 emission in 67 destination countries affects outbound tourism were examined. Because of possible reverse causality between CO2 emissions, the square term and total outbound, valid instruments was employed and estimated a panel instrumental variable regression model with fixed effects. The result unveils that outbound tourism increases with CO2 emission until a maximum emission level is attained.

Maximum Emission Level

Outbound Tourism

Nigeria

Nonlinear Effect

CO2 Emission