Public Policy and Professional Sports

Public Policy and Professional Sports

International and Australian Experiences

New Horizons in the Economics of Sport series

John K. Wilson and Richard Pomfret

Public Policy and Professional Sports​is a comprehensive analysis of public policy aspects of the economics of professional sports, supported by in-depth international case studies. It covers regulation and competition in the sports industry and its labour markets, public spending on stadiums and mega-events, and governance issues including unethical behaviour (corruption, doping, etc). The innovative feature of the work is the combination of economic analysis and well-known international examples with detailed case studies​ of public policy as it relates to sport in Australia. Australia​is an excellent case study due to the high profile of sport in the national psyche and the range of popular professional sports.

Chapter 6: Mega-event bidding

John K. Wilson and Richard Pomfret

Subjects: economics and finance, political economy, sports, politics and public policy, political economy


Competition among rival host cities for mega sporting events such as the Olympic Games or Fédération Internationale de Football Association (FIFA) World Cup has intensified over the last 30 years. Increasingly, governments are making taxpayer-funded bids. Few, if any economic benefits from holding these events have been demonstrated in the literature (see Chapter 5). Importantly, even with low or even negative benefits available, the bidding process is itself probabilistic and is unlikely to be on a level playing field. In particular, claims of bribery have been made at both FIFA and the International Olympic Committee (IOC) (see Chapter 8), however at the very least, the ‘rules of the game’ are not transparent. This chapter examines the reasons behind the exuberance for mega-event hosting and the often wild expectations regarding the likely economic benefits of hosting these events. In this chapter we consider issues such as political objectives, and view much of this through the lens of public choice theory. In particular, we examine the lobbying role of those who stand to gain from the bidding action itself, and the role of those who ultimately gain from an award of hosting rights.

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