The Economic Impact of Terrorist Incidents on the Italian Hospitality Industry

Abstract

Acts of terror are intended to incite fear and intimidation, which makes tourism particularly susceptible to attacks. Because the hospitality industry serves as a useful barometer of the indirect impact of attacks, we examine the impact of terrorist incidents on lodging-use rates in Italy between 1995 and 1997. We make use of data on domestic as well as international terrorism at the city level to explore more localized implications of terrorist incidents. We find that lodgings used by foreign visitors are the most sensitive to terrorist attacks and that the incidents have the largest impact during the year of the attack.

The Impact of ETA’s Dissolution on Domestic Tourism in Spain

“…However, there is limited evidence that a differentiated impact with respect to international visitors may exist. For example, Greenbaum and Hultquist (2006) found that demand for lodgings used primarily by domestic visitors to Italy is less sensitive to terrorist attacks. In the US, traces of a substitution effect between 'safe' domestic destinations (i.e.…”

The influence of terrorism in tourism arrivals: A longitudinal approach in a Mediterranean country

“…The topic of terrorism spillover effects has produced a considerable amount of literature (Veréb, Nobre, & Farhangmehr, 2018). The decline in tourists' arrivals and receipts caused by terrorism is well documented in several countries and regions since the 90s and has affected countries like Spain (Enders & Sandler, 1991), European countries ( (Enders, Sandler, & Parise, 1992;Radić, Dragičević, & Sotošek, 2018), the Mediterranean region (Drakos & Kutan, 2003), non-democratic countries and Africa (Blomberg, Hess, & Orphanides, 2004), the USA (Bonham, Edmonds, & Mak, 2006;Goodrich, 2002), Israel (Eckstein & Tsiddon, 2004;Fleisher & Buccola, 2002;Morag, 2006;Pizam & Fleischer, 2002), Italy (Greenbaum & Hultquist, 2006), Nepal (Baral, Baral, & Nigel, 2004), Ireland (O'Connor, Stafford, & Gallagher, 2008), Fiji and Kenya (Fletcher & Morakabati, 2008), Nigeria (Adora, 2010); Turkey (Feridun, 2011;Ozsoy & Sahin, 2006), Pakistan (Raza & Jawaid, 2013), the Middle East (Bassil, 2014), the Caribbean (Lutz & Lutz, 2018), Tunisia (Lanouar & Goaied, 2019), and worlwide (Liu & Pratt, 2017;Llorca-Vivero, 2008;Neumayer & Plümper, 2016).…”

Economic effects of terrorism: Local and city considerations, priorities for research and policy

“…Understanding economic effects is especially of interest in countries where tourism is an important source of revenue, and which are also attacked, such as Greece, Spain, Turkey, and Kenya. Research on tourism in one country (Buigit & Amendah, ; Greenbaum & Hultquist, ; O'Connor, Stafford, & Gallagher, ) or a small number of countries (Drakos & Kutan, ; Enders & Sandler, ) has identified some key effects, but these studies usually do not offer greater comparability across industries or contexts. In their study of the effect of terrorism on Kenyan tourism, Buigit and Amendah () estimated the losses associated with a one‐unit rise in fatalities to be more than 2,500 visitors and close to 160 million shillings annually.…”

“…Investigating many subnational spatial units, for as long a period as possible, can help identify the underlying and “before” characteristics of a community which supports greater or less resilience. For example, Greenbaum and Hultquist () uncovered interesting effects of terrorism specifically on local lodging‐use rates in Italy, but their study was limited to the period 1995–1999, not accounting for other possible interactions in the external environment, e.g., demand trends. Gaibulloev and Sandler () studied 51 African countries over a long period (1970–2007) and identified new regional effects of transnational terrorism on income per capita growth.…”