Sustainable Governance of Coastal Areas and Tourism Impact on Waste Production: Panel Analysis of Croatian Municipalities

The research problem this paper is concerned with is the effect of tourism on solid waste generation in Croatia's coastal area. We are aware of the fact that this has not been thoroughly addressed, especially considering tourism's share in the Croatian economy and the pressure it generates on sustainable coastal management. This is of particular importance considering the governing complexity of coastal areas. Thus, we ask a simple question regarding the role of the tourism industry in the solid waste generation in the Croatian coastal area: Do tourists generate relatively more solid waste than the domestic population? The falsifiable hypothesis is stated in terms of the difference in the production of communal waste between domestic population and tourists, taking into account local idiosyncratic factors, when such a difference is recoverable through statistical analysis of measurable tourist presence in panel data. The first hypothesis is thus: The amount of solid waste produced by local residents in Croatian coastal municipalities diverges significantly in statistical terms from the amount of solid waste produced by tourists. The second hypothesis is: The amount of waste-streams is influenced by local idiosyncrasies of coastal settlements, their economic structure, per capita GDP and/or cultural background of local people. Our dataset is a panel of 160 municipalities in the Croatian coastal area spanned across a time period of 12 months during 2019, giving us a total of 1920 panel observations. We performed a Panel Estimated Generalized Least Squares cross-section fixed effects analysis with Panel Corrected Standard Errors on domestic population and tourist overnight stays and their solid waste generation. We used the above mentioned method to achieve better results with higher significance, and lower Standard Errors than comparable methods. We complemented the analysis with a dynamic Panel Generalized Method of Moments First Differences test. Results show a relatively larger relative impact of tourist overnight stays on municipal solid waste generation than what is to be expected from the locals only. Our different methods of analysis ended with non-contradicting results. The number of tourist overnight stays in some municipalities shadows the overnight stays of the local population as an indicator of solid waste generation, exacerbating the problem of sustainability of waste disposal. We conclude that the relative waste disposal impact of the tourists is at least 22% greater and possibly up to 55% greater than the one of local inhabitants, contradicting some other research. We also found evidence of possible Environmental Kuznets Curve behavior.