Natural disasters, trade openness and international tourism: the role of income levels across countries

ABSTRACT

This study uses a gravity framework to investigate the effects of natural disasters and trade openness on bilateral tourism flows. This includes investigating the influence of income levels across countries in the underlying relationships. Results show that the effects of natural disasters and trade openness on tourism flows differ by income groups. For instance, population share affected by storms negatively affect tourism flows in low-income countries, whereas its effect in high-income countries is statistically insignificant. The results also indicate that the negative effect of volcanoes on tourism flows persists after a year in some income groups. Furthermore, trade openness promotes tourism flows in low-income countries, while its effect in high-income countries is statistically insignificant. Appropriate urban planning should be used as a tool to prevent the construction of buildings in high-risk areas to reduce the share of the population that are exposed to danger in the event of natural disasters.

KEYWORDS:

• Natural disasters
• trade openness
• tourism flows
• urban planning
• income groups
• gravity model

Disclosure statement

No potential conflict of interest was reported by the authors.

Additional information

Notes on contributors

Luke Emeka Okafor

Luke Emeka Okafor is an Associate Professor of Economics at the University of Nottingham Malaysia (UNM). He received his PhD in Economics from Monash University, Australia, in 2015. His research interests include international economics, firm behaviour, applied economics, tourism economics, development economics and finance.

Ogechi Adeola

Ogechi Adeola is an Associate Professor of Marketing and Head of Department of Operations, Marketing and Information Systems at the Lagos Business School, Pan-Atlantic University, Nigeria. Her research interests include tourism and hospitality, strategic marketing, sustainable indigenous entrepreneurship and digital marketing strategies in sub-Saharan Africa.

Oludele Folarin

Oludele Folarin is a PhD candidate in the Department of Economics, University of Ibadan, Nigeria. His research interests include bank behaviour, financial constraints, livelihood of the poor and tourism development.