The everyday cost of paradise: seasonal grocery inflation as a tourism-led externality

Zvonimir Kuliš, Josip Mikulic and Stjepan Srhoj

No 1774, GLO Discussion Paper Series from Global Labor Organization (GLO)

Abstract: This study conceptualizes tourism-led grocery inflation as a cost-of-living externality affecting everyday goods. Using retailer-published price microdata for Croatia, it aggregates 1.3 billion daily observations into monthly datasets covering May-October 2025. Prices are already higher in tourism-intensive coastal municipalities in May and then show additional coastal price growth over the summer, tracing an inverted U-shaped pattern that peaks in July-August and moderates by October. The pattern persists for essential goods and identical barcode-matched products. Retailer responses are heterogeneous: some chains show stronger coastal price increases during the peak season, while others show little or no coastal-inland differential. The findings identify a resident-facing tourism externality and support local cost-of-living monitoring to inform place-sensitive policy.

Keywords: Tourism-led inflation; cost-of-living externality; retail price microdata; seasonality; resident welfare; Croatia (search for similar items in EconPapers)
JEL-codes: D12 E31 L83 (search for similar items in EconPapers)
Date: 2026
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:glodps:1774

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