ASEAN Journal on Hospitality and Tourism, Vol 12, pp. 31-48 Printed in Indonesia. All right reserved 31 AN EMPIRICAL ANALYSIS OF DAILY INTERNATIONAL TOURIST ARRIVALS AND RISK BY LAND TRANSPORT: A CASE OF THE ASIA HIGHWAY IN SONGKHLA PROVINCE OF THAILAND HARI SHARMA NEUPANE 1 PhD scholar in Faculty of Economics, Chiang Mai University, Thailand PETER CALKINS Professor, Chiang Mai University, Thailand and Researcher, Centre for Research in Agriculture and Economics, Laval University, Quebec, Canada Asian Highway route No. 4, the only main national highway that links to the North South Economic corridor of the Greater Mekong Sub-region at Bangkok, is the gateway for East Asian countries to enter into the Thailand by land transport. Hence, the twin purposes of this paper are to a) appraise the present state of international tourist arrivals by land transport into Songkhla province of Thailand and to b) model the associated risk. Conditional mean and conditional volatility models from the ARCH family were adopted to illustrate the behavior of daily international tourist arrivals into the province. The parameters of the conditional mean and conditional volatility models are statistically significant and the Quasi Maximum Likelihood estimators are also valid and statistically consistent. The results show that almost 80% of those arrivals were from Malaysia and that short run risk is persistent. Negative asymmetric behavior is also observed in the daily international arrivals by land. The strategic implications of this empirical study envisage sufficient room for intervening or amending provincial tourism policy to better attract and stabilize Malaysian tourist arrivals and to promote tourism as a local business. international arrivals, transport, volatility, tourism, Thailand, ARCH family, JEL Classification: C 22 INTRODUCTION The modern tourism industry is now firmly established as a vital economic endeavor for both developed and developing countries. It acts a key driver for socio-economic advancement through job creation; enterprise specialization; infrastructure development; and the earning of export revenues (UNWTO, 2010). Fundamentally, the number of tourist arrivals is not only the key determinant for a successful tourism business, but it is also the key source of anxiety for private sector entrepreneurs and government policy- makers. Over the last six decades, tourism industry has established as a one of the largest and fastest-growing economic sectors in the world and experienced continued expansion and diversification and the international tourist arrivals (overnight visitors) reached 1035 million in 2012, globally (UNWTO, 2013). The „Tourism 2020 Vision‟ has projected that they will reach nearly 1.6 billion by the year 2020 (UNWTO, 2010). Within the Asia and Pacific region of which Thailand is a part, international arrivals have been growing even 1 Address correspondence to Hari Sharma Neupane: Faculty of Economics, Chiang Mai University, Thailand. Email: hsneupane@yahoo.com