Tourism and Growth in the Local Labor Market

Laura Conti (), Marco Francesconi, Giulio Papini () and Michel Serafinelli ()
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Laura Conti: Bank of Italy
Giulio Papini: Bank of Italy
Michel Serafinelli: King's College London

No 17933, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper documents how the local labor market (LLM) responds to a change in touristic attractiveness. Leveraging largely underutilized data from several sources, we exploit a unique classification of Italian localities based on their main touristic assets and aggregate trends in foreign tourists' choices in a shift-share research design. Looking at all LLMs, we find a strong positive relationship between changes in attractiveness and changes in the local tourism-related economic activity, with a positive impact on tourism expenditure and tourism employment, but no effect on total employment. In high-unemployment LLMs, however, we find evidence of sizable total employment effects and large indirect effects generated through industries related to tourism and firms in the nontradable sector. We observe no effects on wage growth. We discuss our results in the context of the current policy debate on the role of tourism in the development of the local economy.

Keywords: local spillovers; unemployment; job growth; tourism; heterogeneity (search for similar items in EconPapers)
JEL-codes: J21 R11 R12 R23 Z30 (search for similar items in EconPapers)
Date: 2025-06
New Economics Papers: this item is included in nep-eur, nep-lma and nep-tur
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