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This article investigates the impact of terrorism on bilateral tourism flows within the Organization for Economic Co-operation and Development countries. It also examines the moderation effect of immigration in the destination country on the terrorism–tourism relationship. The results obtained from the estimated gravity models show that after reaching a certain threshold, terrorism negatively impacts tourist arrivals. This relation seems to be moderated by the share of immigrants in the country of destination: when the share of immigrants in a country is relatively high, the positive impact of immigration on tourist arrivals would counterbalance the adverse impact of terrorism on tourist arrivals.

Using regional data encompassing 155 Nomenclature of Territorial Units for Statistics (NUTS) regions across the EU-28 member states, we estimate the effect of tourist arrivals (total, domestic, and foreign) on regional growth over 2000-2018. Our empirical strategy tackles three data properties that cripple common econometric approaches: cross-section dependence, nonstationarity, and the endogeneity of the regressors. In addition to “pooled” models that assume common parameters across regions, we run “heterogeneous” models where parameters are allowed to differ between regions. Results of the pooled estimations show that domestic and total tourism inflows have positively and significantly contributed to growth, and the positive effect of foreign tourism is statistically discernible in regions that are mainly destinations for foreign tourists. Findings based on region-specific regressions reveal that the average impact on regional growth of tourist inflows is positive and significant, and large regional disparities in terms of the growth impact of domestic/foreign tourism exist.