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

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.