Diagnosing the Impact of an Event on Hotel Demand: The Case of the BP Oil Spill.

Assessing the impact of the BP oil spill on hotel demand was the focus of this study. More specifically, this analysis chronicles the demand trajectories of the two most impacted regions of the Gulf Coast by employing a pseudo-experiment ‘compromise design’ to measure the impact of an event on consumer demand involving a sector subject to high seasonality and other disruptive influences. The results reveal that the volatility brought about by this man-made disaster varied greatly and, though significant, paled in comparison to impacts caused by major hurricanes and recessions. In addition, this research highlights an important but neglected area of the tourism literature – the objective measure of tourism losses due to a disaster – that serves as one of the initial steps to economic recovery for a community or business sector.