The impact of COVID-19 on tourism expenditures: A Quasi-DiD analysis

Abstract

We investigate the impact of COVID-19 on tourism expenditures by analyzing survey data collected from participants of one of the major amateur cycling races in Italy—the Nove Colli. We gathered information from different types of participants (tourists, residents, day-trippers) about their travel expenses, accommodation, food and beverage, and side goods such as sports equipment. The survey covers three race editions: pre-COVID-19 in 2016, post-lockdown in 2021, and post-COVID-19 in 2022, for a total of 2734 respondents. Using a quasi-difference-in-differences approach, we find a significant increase in total tourism expenditures due to COVID-19, primarily driven by a substantial increase in side goods expenses, which more than doubled the rise in food and beverage expenses. This result can be partly explained through revenge spending as a form of compensatory consumption behavior and inform policy-makers on how individuals’ spending patterns may change in the aftermath of an exogenous shock.