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The economic impact of Sargassum: Evidence from the Mexican coast

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  • Schling, Maja
  • Guerrero Compeán, Roberto
  • Pazos, Nicolás
  • Bailey, Allison
  • Arkema, Katie
  • Ruckelshaus, Mary

Abstract

This paper assesses the economic impact of pelagic Sargassum seaweed washed ashore in tourism-heavy coastal zones in the Mexican State of Quintana Roo. We use a geographic information systems (GIS) dataset of monthly observations from 2016 to 2019 for 157 beach segments. The dataset comprises an innovative measure of Sargassum seaweed presence, remotely sensed nighttime light intensity as a proxy of economic growth, as well as information on key infrastructure, sociodemographic and beach characteristics. We perform an event study by applying a fixed-effects regression model that controls for general time trends and unobserved, time-invariant differences across observations. We estimate that the presence of Sargassum in a beach segment reduces nighttime light intensity by 17.5 %, representing an approximate 11.6 % decrease in gross local product. Our analysis finds significant lagged effects up until 12 months after Sargassum was detected that range between 5.9 % and 9.9 %. The estimated impacts are consistently significant and negative across numerous specifications, including an adjusted measurement of Sargassum and the consideration of potential spatial correlation across beach segments. These results highlight the considerable negative impacts of Sargassum on coastal economies and the need for public and private interventions to heighten economic resilience in coastal communities.

Suggested Citation

  • Schling, Maja & Guerrero Compeán, Roberto & Pazos, Nicolás & Bailey, Allison & Arkema, Katie & Ruckelshaus, Mary, 2026. "The economic impact of Sargassum: Evidence from the Mexican coast," Ecological Economics, Elsevier, vol. 241(C).
    • Handle: RePEc:eee:ecolec:v:241:y:2026:i:c:s092180092500360x
    DOI: 10.1016/j.ecolecon.2025.108877
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    References listed on IDEAS

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    Keywords

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    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • C52 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Evaluation, Validation, and Selection
    • N56 - Economic History - - Agriculture, Natural Resources, Environment and Extractive Industries - - - Latin America; Caribbean
    • O44 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Environment and Growth
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes
    • Z32 - Other Special Topics - - Tourism Economics - - - Tourism and Development

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