Table of Contents

International Handbook on the Economics of Mega Sporting Events

International Handbook on the Economics of Mega Sporting Events

Elgar original reference

Edited by Wolfgang Maennig and Andrew Zimbalist

From the Olympics to the World Cup, mega sporting events are a source of enjoyment for tens of thousands of people, but can also be a source of intense debate and controversy. This insightful Handbook addresses a number of central questions, including: How are host cities selected and under what economic conditions? How are these events organized, and how is local resistance overcome? Based on historical and empirical experience, what are the pitfalls for the organizers of these events? What are the potential economic benefits, including any international image effects? How can the costs be minimized and the benefits maximized for host cities and countries? How do these mega events impact the challenges of globalization and what is their environmental legacy?

Chapter 20: Economic Impact of Organizing Large Sporting Events

Elmer Sterken

Subjects: economics and finance, public sector economics, sports

Extract

Elmer Sterken 1 INTRODUCTION The economic impact of organizing large sporting events is a topic that attracts lively attention (see, for instance, Preuss, 2006, for an overview). Governments (both federal and local), sports federations (National Olympic Committees, international federations such as the International Amateur Athletic Federation (IAAF), the International Olympic Committee (IOC) and FIFA), potential organizers and consultants debate about the total economic value added of such large events. In general, one could consider any sporting event and debate its possible (local) welfare gain, but the scale of the event is relevant to the impact issue if one considers national development. Individual surveys and/or cost–benefit analyses possibly could indicate the welfare improvement and the subjective increase in social returns these major sporting events bring, but do not adhere to the main issue: is it ex ante beneficial for a national government to apply for the organization of mega sporting events? In this study we measure the total economic value added of so-called ‘sporadic events’ (these are regular but not annually organized events, see Barget and Gouguet, 2007) at the macroeconomic level: that is, we are interested in additional growth of (per capita) gross domestic product (GDP). These major sporting events include multiple sports (such as the Olympic Games) or single sports events (World Cup Soccer). The required scale implies that we need to consider sporting events of a certain minimum size. Barget (2001) defines a large sporting event nowadays to be an event with at least 1 billion viewers...

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