Tourism demand recovery following terrorism ceasefire: the case of the Basque country

David Boto-García and José Francisco Baños-Pino

Defence and Peace Economics, 2025, vol. 36, issue 7, 1007-1029

Abstract: While extant literature has investigated the effects of terrorist attacks on tourism arrivals, less is known about how long it takes for a long-standing terrorist-hit region to regain tourism attractiveness following the cessation of armed violence. We study the short- and medium-term effects of the dissolution of ETA terrorist group in 2011 on both international and domestic arrivals to the Basque Country (Spain). Using the Synthetic Control Method (SCM), we show that the inflow of domestic and international tourists to the region increased, on average, by 90 and 108 thousand people per year (5.6% and 11.5%, respectively) following the end of armed conflict compared to counterfactual outcomes if ETA had continued their terrorist activities. Moreover, using input-output methodology, we estimate that the direct and indirect effects to the Basque economy resulting from this shift in tourism demand amount to 50 and 23 million euros of additional value added per year, on average.

Date: 2025
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DOI: 10.1080/10242694.2025.2486442

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