On nature’s shoulders: riding the big waves in Nazaré

The use of counterfactual methods in the evaluation of policy interventions has been accepted today as the best approach in the estimation of a program’s performance. However, the simplest evaluations are often quite demanding in terms of the resources and the time needed to be implemented. In this article, we study the economic impact of a tourism media campaign launched in Nazaré, an old fishing community on the west coast of Portugal, to make big waves visible to the world. The campaign provided the required “informational media infrastructure” that created the public awareness necessary to boost tourism in the region. To measure the economic impact of that campaign on the local economy, we show how a counterfactual analysis can be implemented using regional statistical data on domestic and international tourist arrivals. We show how the method can be adapted to account for the presence of potential spillover effects that may have occurred, as neighboring municipalities could also have been affected by the intervention. We further compare the estimated impact on revenues with the costs incurred by the local municipality in the marketing campaign. Based on our empirical findings, we discuss policy implications to the municipalities in the region.