Computable general equilibrium estimates of the impact of the Bali bombing on the Indonesian economy

This article employs a multi-regional computable general equilibrium model of the Indonesian economy to estimate the short-run effect of a decline in tourism following the 2002 Bali bombings on the Indonesian economy. Our results suggest that of Indonesia's 26 provinces, GDP in Bali is worst affected by a negative shock to tourism exports followed by other popular tourist destinations, such as Jakarta and Yogyakarta. Within Bali we find that the tourism-related and non-tradable sectors contain the worst affected industries while export-oriented industries, such as textiles, clothing and footwear, and import-competing industries, such as machinery and electronics expand.