Do more tourists promote local employment?

Libertad Gonzalez and Tetyana Surovtseva

Economics Working Papers from Department of Economics and Business, Universitat Pompeu Fabra

Abstract: We analyze the short-term impact of tourist flows on local labour markets. We propose a novel identification strategy that uses shocks to competing international tourist destinations to instrument for tourist inflows across Spanish regions. We show that negative shocks in alternative international destinations have a strong positive effect on tourism flows to Spain. We follow an instrumental variables strategy and find that an exogenous increase in tourist inflows leads to more employment in the tourism industry for prime-age workers in the short term but does not increase total employment in local economies. Total employment actually falls for very young and older workers, as well as for prime-age women. The increase in employment in tourism is compensated by a fall in (low-skilled) employment in other sectors, especially construction and manufacturing.

Keywords: employment; tourism; local labour markets; shift-share; terrorism; Spain (search for similar items in EconPapers)
JEL-codes: J21 (search for similar items in EconPapers)
Date: 2020-10
New Economics Papers: this item is included in nep-lma, nep-tur and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Working Paper: Do More Tourists Promote Local Employment? (2024)
Working Paper: Do More Tourists Promote Local Employment? (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:upf:upfgen:1746

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