This paper analyses the impact of terrorist activity on international tourist flows. To this end, we have estimated a cross-sectional gravity equation for tourism from the G-7 countries to a sample of 134 destinations over the period 2001-2003. Within this framework, we evaluate the deviation from 'normal' tourist flows due to terrorist activity, which is considered as negative advertising for the affected country. The analysis suggests that both domestic victims and international attacks are relevant factors when foreign tourists make their choice. This result is robust under alternative specifications. Moreover, the impact of terrorism is more severe in developing countries.Domestic terrorism, International terrorism, Gravity model, Negative advertising, Tourist flows,

This paper estimates the effect of the euro on intra-EMU tourist flows by using a panel dataset of 20 OECD countries over the period 1995-2002. The results reveal that the euro has increased tourism, with an effect of around 6.5%. This is a noticeable impact given the early stage of the EMU analyzed. The robustness checks show that the evidence of a positive impact is quite widespread across EMU destination countries. Copyright � 2006 The Authors; Journal compilation � 2007 Blackwell Publishing Ltd.

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