The Impact of Economic Instability on the Development of the European Tourism Market

Abstract

The paper studies modern trends and factors of instability in the European tourism market. Using the methods of statistical analysis, the authors explored the impact of crises on the dynamics of the tourism market indicators. The low but steady growth rate of the tourism industry in European countries over two decades was only once disrupted by the global economic crisis of 2008-2009. Until 2020 the European tourism has been showing good adaptability to instability factors and a high rate of abilities to recover from crises. The 2020 crisis has given rise to the worst external shock to the European tourism market in its history. Using two methods (arithmetic mean of normalized partial stress indices and principal component analysis), an integral stress index for the tourism industry were constructed, allowing to identify the onset of economic instability for the tourism industry. This index was composed of such private indicators as tourist arrivals, overnight stays, occupancy and tourism turnover, and calculated for four EU countries (Italy, Spain, Germany and Finland). Based on its dynamics, we identified the periods of increasing stress for each country’s tourism market and made conclusions about a significant correlation of tourism stress indices of the countries under consideration.