Transatlantic Sport

Transatlantic Sport

The Comparative Economics of North American and European Sports

Edited by Carlos Pestana Barros and Muradali Ibrahímo

This book offers a comparative perspective on the economics of sport and highlights both the similarities and differences in the North American and European models of sport. It tackles policy issues, such as the organising, financing and regulation of team sports alongside theoretical issues regarding income redistribution and competitive balance. It also evaluates the impact of sport and sports events on local communities and the wider economy providing a useful contrast of methods and results on the two continents.

Chapter 7: Economic impact of sporting events: what has to be measured?

J.J. Gouguet

Subjects: economics and finance, sports

Extract

J.J. Gouguet The measurement of the economic impact of the biggest sporting events is a source of controversy between economists (Barget and Gouguet, 2000). Overall, two main questions have to be asked: – – how to carry out such a measure ? which function has to be given to these results ? The first question gives rise to important problems of methodology which the authors of impact studies do not always completely master. The result is often a substantial over-evaluation of the real repercussions of sporting events. The second, which is more fundamental, has been abundantly treated mainly in English literature: are governmental subsidies or public aid for the construction of big stadiums justified compared to the extent of economic impact that these sporting events would create? (Lavoie, 1997). It is then often demonstrated by academic economists that organizers ask for these subsidies in the name of an economic impact which would not, in fact, exist (Baade and Matheson, 2000). Nonetheless, it appears to us that this answer is not totally satisfactory, as the justification of the subsidy should not be only considered in relation to the amount of the economic impact of the event. So, we are going to try in this chapter to show on which analytical bases it is possible to talk about all these controversial questions which reflect the increasing financial stakes linked to the biggest sporting events: does the construction of sport infrastructure have to be subsidized? Is public aid to professional clubs justified? To...

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