Modeling Economic Impact: Structural Equation Analysis of Ram Mandir’s Influence on Ayodhya

Abstract

This study explores the economic impact of the Ram Mandir development on Ayodhya through a comprehensive Structural Equation Modeling (SEM) approach. The objectives focus on assessing the direct influence of tourism development as an independent variable on the economic outcomes (dependent variable) in Ayodhya. It also evaluates the role of infrastructure investment in fostering local business growth, which acts as a mediating variable, ultimately influencing the overall economic landscape. By quantifying the total, direct, and indirect effects of several independent variables—including tourism development, infrastructure investment, cultural significance, and government policies—this research aims to illuminate their collective influence on economic impact, mediated by local business growth, employment opportunities, and urban development.

To accomplish this, an array of data analysis tools were employed. Descriptive statistics were initially utilized to summarize the fundamental characteristics of the dataset, establishing a foundation for further analysis. Subsequently, Exploratory Factor Analysis (EFA) was conducted to identify the underlying structure and determine the latent variables pertinent to the SEM model. Path analysis was then employed to assess the hypothesized direct relationships, specifically the effect of tourism development on local business growth.

Finally, Goodness-of-Fit Testing was performed to ascertain the model's accuracy and the extent to which it aligns with observed data. The findings highlight the significant interplay between tourism development and economic growth in Ayodhya, demonstrating how infrastructure investments can spur local business expansion and contribute to enhanced economic outcomes. This study not only contributes to the theoretical literature on economic impacts stemming from cultural and tourism developments but also offers valuable insights for policymakers aiming to strategically harness the economic potential of religious tourism in Ayodhya.