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Fire takes no vacation: impact of fires on tourism

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  • Vladimir Otrachshenko
  • Luis C. Nunes

Abstract

Many Mediterranean-type climates around the world will face increased risks of wildfires as a consequence of climate change. In this study we consider the case of Portugal and estimate the impact of the increasing risk of forest fires on tourism. Using data for 278 municipalities for the 2000-2016 period we find a considerable negative impact of burned areas on the number of tourist arrivals, both domestic and inbound. We go beyond the traditional impact analysis and provide predictions for 2030 and 2050. The estimated costs to the Portuguese economy due to the impact of burned areas in 2030 range between 17.03 and 24.18 million Euros for domestic tourist arrivals and between 18.26 and 38.08 million Euros for inbound ones. In 2050, those costs will increase at least fourfold. These findings underscore the importance of taking the forest fire risks into account when planning local investments.

Suggested Citation

  • Vladimir Otrachshenko & Luis C. Nunes, 2019. "Fire takes no vacation: impact of fires on tourism," FEUNL Working Paper Series wp632, Universidade Nova de Lisboa, Faculdade de Economia.
  • Handle: RePEc:unl:unlfep:wp632
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    References listed on IDEAS

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    More about this item

    Keywords

    Climate change; economic development; fires; future projections; tourism; Portugal;

    JEL classification:

    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • 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

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