Tourism and (Urban) Economics

Economics of Tourism and Cities Kick-Off Conference
Università di Bologna, Rimini Campus

Florian Oswald
florian.oswald@unito.it

Università di Torino and Collegio Carlo Alberto

16 October, 2025

A Brief History of Tourism: How It All Started

NYT article from 2008:

Three hundred years ago, wealthy young Englishmen began taking a post-Oxbridge trek through France and Italy in search of art, culture and the roots of Western civilization. With nearly unlimited funds, aristocratic connections and months (or years) to roam, they commissioned paintings, perfected their language skills and mingled with the upper crust of the Continent.

A Brief History of Tourism

Grand Tour Itineraries

The 8th Duke of Hamilton with Dr John Moore in Geneva
Figure 1

The Path to Mass Tourism

Our World in Data, Herre and Samborska (2023)

World Income

Our World in Data, Herre and Samborska (2023)

Tourism vs Income

Our World in Data, Herre and Samborska (2023)

Share of Tourism in the Macroeconomy

Our World in Data, Herre and Samborska (2023)

Share of Tourism in the Macroeconomy

Our World in Data, Herre and Samborska (2023)

Government Policy

Government Policy


  • The Natural Resource Curse in Poor Countries.

  • Tourism Policy in rich OECD countries?

  • Is Tourism a Growth Sector?

  • What about Labor Markets in Tourism?

  • So, how can we grow tourism then?

Externalities

Some Issues with Mass Tourism


  1. The problem of the commons: A publicly available resource will be depleted by profit maximizing entrepreneurs if not regulated in some way. Think of beaches or ski resorts.
  2. Higher rental prices in cities.
  3. Noise. Congestion.
  4. Overtourism in general: is there a middle way between becoming Disneyland and no tourism revenues at all? How stringent should limits on mass tourism be? How to decide?

Tourists in Cities


  • We must decide on an allocation of space for different uses.
  • Growth in Urban Tourism expected very strong.
  • Policy makers must confront the critical tradeoffs: You cannot make everybody happy here.

The Arrival of Platform Capitalism in our Cities


  • Airbnb, Uber, Deliveroo, Lime etc
  • Digital Platform acting as a match maker
  • Conflict with other (traditional) forms of business.
  • Many different approaches and layers to regulation.

Airbnb Interest Groups

  1. Airbnb
  2. Associations of “home sharers” (hosts)
  3. The hotel industry
  4. Residents’ associations
  5. Sharing economy advocates
  6. Corporate platforms

Airbnb in The City

Figure by Aguilera, Artioli, and Colomb (2025), Housing under Platform Capitalism

Why Measuring Airbnb Impact on Rents is Difficult


  • We typically have data on long term rental rates next to the number of airbnb listings in a certain area of a city.
  • We see airbnb’s increase, and we see rents increase.
  • Is this evidence that airbnb caused rents to go up?
  • What if some city area is gentrifying (i.e. improving), thus getting more interesting for locals and for airbnb tourists at the same time?

Recent Research:
Airbnb, Rents and Amenities

Impact of Airbnb on Rents in Barcelona

Garcia-López et al. (2020)

Impact of Airbnb on Rents in Barcelona

Figure 2: Garcia-López et al. (2020)

Airbnb and Local Amenities: Amsterdam


Almagro and Domı́nguez‐Iino (2025)
  • How do amenities in a city change over time?
  • In particular, as mass tourism arrives?
  • Who is better or worse off after this?

Airbnb and Local Amenities: Amsterdam

Almagro and Domı́nguez‐Iino (2025)

Airbnb and Local Amenities: Amsterdam


Almagro and Domı́nguez‐Iino (2025) find:

  • Young Amsterdam residents are compensated for the rent increases by new amenities which they find interesting (bars, restaurants)
  • Older Amsterdam residents loose out.

Other Externalities of Tourism on Locals: Paris


Avetian and Pauly (2025)


  • Do tourists ruin locals’ experience of amenities?
  • People talking too loudly at the next table?
  • This study uses Terrorism and COVID shocks to see whether restaurant reviews get better as no tourists are around.
  • They do.

Other Externalities of Tourism on Locals: Paris


Figure 1

Figure 3
Figure 3: Avetian and Pauly (2025)

Summary

  1. Tourism for the masses is a sign of prosperity and wellbeing.
  2. Mass Tourism also poses challenges for (local/global) jurisdictions: Space is limited, and we must regulate (market does not solve the problem!).
  3. Formulating policy responses requires precise measurement of effects.
  4. The effects are nuanced, localized, but significant.
  5. Much work remains to be done. 👉 Your turn!

Thanks for listening!
… and Good Luck with your Studies!

References

Aguilera, Thomas, Francesca Artioli, and Claire Colomb. 2025. Housing Under Platform Capitalism. The Contentious Regulation of Short-Term Rentals in European Cities.
Almagro, Milena, and Tomás Domı́nguez‐Iino. 2025. “Location Sorting and Endogenous Amenities: Evidence from Amsterdam.” Econometrica 93 (3): 1031–71. https://doi.org/https://doi.org/10.3982/ECTA21394.
Avetian, Vladimir, and Stefan Pauly. 2025. “You Can’t Sit with Us: How Locals and Tourists Compete for Amenities in Paris.” Journal of Urban Economics 148: 103773. https://doi.org/https://doi.org/10.1016/j.jue.2025.103773.
Garcia-López, Miquel-Àngel, Jordi Jofre-Monseny, Rodrigo Martı́nez-Mazza, and Mariona Segú. 2020. “Do Short-Term Rental Platforms Affect Housing Markets? Evidence from Airbnb in Barcelona.” Journal of Urban Economics 119: 103278. https://doi.org/https://doi.org/10.1016/j.jue.2020.103278.
Herre, Bastian, and Veronika Samborska. 2023. “Tourism.” Our World in Data. https://doi.org/https://ourworldindata.org/tourism.