The economic impacts of tropical cyclones on a mature destination, Florida, USA

Abstract

Climatic hazards such as tropical cyclones pose multi-faceted threats to coastal tourism, inflicting physical damage to infrastructure, causing business interruption, and requiring the evacuation of tourists, not to mention the ensuing damage to the destination's image. Using the State of Florida, USA, as a case study, this research integrates GIS-based tropical cyclone wind swath data with industry-level monthly sales data in a cross-county panel to explore the differential impacts of these extreme weather events among inland and coastal destinations. This study uses secondary data collected by from the state of Florida and the US federal government to estimate revenue losses to 6 sectors in Florida's tourism economy due to tropical cyclones between 2008 and 2018. Based on the pooled sample of all counties, mean per county losses were estimated to be approximately $10 million during the month of the storm, $12 million in the first month post-storm, and $7 million in the second month post-storm. Coastal counties had mean estimated losses of approximately $12.5 million in the month of the storm and persistent effects for the following 2 months. Inland counties had estimated losses of approximately $7.5 million in the month of the storm and a positive recovery effect in the fourth ($1.6 million) and fifth ($2.7 million) months post-storm. These results suggest that Florida's coastal counties are most impacted by tropical cyclones in terms of tourism-related losses.