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Mega-Sporting Events in Developing Nations: Playing the way to Prosperity?

Author

Listed:
  • Victor A. Matheson
  • Robert A. Baade
Abstract
Supporters of mega-sporting events such as the World Cup and Olympics claim that these events attract hoards of wealthy visitors and lead to lasting economic benefits for the host regions. For this reason, cities and countries compete vigorously for the right to stage these spectacles. Recently, developing countries have become increasingly vocal in demanding that they get the right to share in the economic benefits of these international games. China, for example, has been awarded the 2008 Summer Olympics, and an African nation seems destined to host the 2010 World Cup. The specialized infrastructure and operating expenses required to host these events, however, can be extremely costly, and it is not at all clear that either the long or short-term benefits of the games are anywhere nearly large enough to cover these costs. This paper reviews other researchers' as well as our own previous work on mega-sporting events such as the Super Bowl and World Series as well as international events like the World Cup and Olympics. Independent researchers nearly unanimously find that boosters' projections of the economic impact of sporting events exaggerate the true economic impact of these competitions by a wide margin. In particular, in this paper we focus on the particular circumstances that face developing countries hosting these games. Our research suggests that in most cases mega-sporting events are an even worse investment for developing countries than for industrialized countries.

Suggested Citation

  • Victor A. Matheson & Robert A. Baade, "undated". "Mega-Sporting Events in Developing Nations: Playing the way to Prosperity?," Center for Development Economics 174, Department of Economics, Williams College.
    • Handle: RePEc:wil:wilcde:174
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    File URL: https://web.williams.edu/Economics/wp/mathesonprosperity.pdf
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    References listed on IDEAS

    as
    1. Robert Baade & Victor Matheson, 2004. "The Quest for the Cup: Assessing the Economic Impact of the World Cup," Regional Studies, Taylor & Francis Journals, vol. 38(4), pages 343-354.
    2. Robert Baade & Victor Matheson, 1999. "An assessment of the economic impact of the american football championship, the Superbowl, on host communities," IASE Conference Papers 9903, International Association of Sports Economists.
    3. Robert Baade & Victor Matheson, 2000. "Bidding for the Olympics: Fools Gold?," IASE Conference Papers 0007, International Association of Sports Economists.
    4. John J. Siegfried & Andrew Zimbalist, 2000. "The Economics of Sports Facilities and Their Communities," Journal of Economic Perspectives, American Economic Association, vol. 14(3), pages 95-114, Summer.
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    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Coupe du Monde de la FIFA 2014 au Brésil : est-ce vraiment rentable ?
      by julien.moussavi@gmail.com (Julien Moussavi) in BS Initiative on 2014-06-05 13:28:44

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    Cited by:

    1. Swart, Kamilla & Bob, Urmilla, 2012. "Listening to community voices: Athlone and green point residents' views on the location of the 2010 FIFA World Cup Stadium in Cape Town," Edition HWWI: Chapters, in: Büch, Martin-Peter & Maennig, Wolfgang & Schulke, Hans-Jürgen (ed.), Zur Ökonomik von Spitzenleistungen im internationalen Sport, volume 3, pages 101-122, Hamburg Institute of International Economics (HWWI).
    2. Roberto Gásquez & Vicente Royuela, 2014. "Is Football an Indicator of Development at the International Level?," Social Indicators Research: An International and Interdisciplinary Journal for Quality-of-Life Measurement, Springer, vol. 117(3), pages 827-848, July.
    3. Johan Fourie & Maria Santana-Gallego, 2017. "The Invisible Hand of Thierry Henry," Journal of Sports Economics, , vol. 18(7), pages 750-766, October.
    4. Robert Baumann & Victor Matheson, 2013. "Infrastructure Investments and Mega-Sports Events: Comparing the Experience of Developing and Industrialized Countries," Working Papers 1305, College of the Holy Cross, Department of Economics.
    5. Vörös, Tünde, 2017. "Költség-haszon elemzési keretrendszer sportberuházások társadalmi-gazdasági értékeléséhez [An economic framework for cost-benefit analysis of sports facilities]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(4), pages 394-420.
    6. Richard Giulianotti & Francisco Klauser, 2011. "Introduction," Urban Studies, Urban Studies Journal Limited, vol. 48(15), pages 3157-3168, November.
    7. Wolfgang Maennig & Florian Schwarthoff, 2006. "Stadium Architecture and regional economic development: International experience and the plans of Durban," Working Papers 200604, Chair for Economic Policy, University of Hamburg.
    8. Ted Hayduk, 2019. "Leveraging sport mega events for international entrepreneurship," International Entrepreneurship and Management Journal, Springer, vol. 15(3), pages 857-881, September.
    9. Simon Planells Struse & Daniel Montolio, 2014. "The effect of football matches on crime patterns in Barcelona," ERSA conference papers ersa14p1606, European Regional Science Association.
    10. Douglas Barrios & Stuart Russell & Matt Andrews, 2016. "Bringing Home the Gold? A Review of the Economic Impact of Hosting Mega-Events," CID Working Papers 320, Center for International Development at Harvard University.
    11. Daniel Montolio & Simón Planells-Struse, 2019. "Measuring the negative externalities of a private leisure activity: hooligans and pickpockets around the stadium," Journal of Economic Geography, Oxford University Press, vol. 19(2), pages 465-504.
    12. Brad R. Humphreys & Bruce K. Johnson & John C. Whitehead, 2020. "Validity and reliability of contingent valuation and life satisfaction measures of welfare: An application to the value of national Olympic success," Southern Economic Journal, John Wiley & Sons, vol. 87(1), pages 316-330, July.
    13. Hai-Yan Huang & Lin Zhang, 2012. "Research Note: Estimation of the Non-Market Value of Sports Events: A Case Study of the Civic Pride Generated by the 2009 Shanghai ATP Masters 1000," Tourism Economics, , vol. 18(4), pages 887-895, August.
    14. Ozan GULER & Gürkan AKDAĞ & Ali DALGIÇ & Sercan BENLİ & A. Celil ÇAKICI, 2015. "How Locals Regard Sport Events In Terms Of Tourism Development? A Research On Xvii Mediterranean Games In Mersin With In The Frame Of Altruistic Surplus Phenomenon," Revista de turism - studii si cercetari in turism / Journal of tourism - studies and research in tourism, "Stefan cel Mare" University of Suceava, Romania, Faculty of Economics and Public Administration - Economy, Business Administration and Tourism Department., vol. 20(20), pages 1-8, December.
    15. Jeroen Schokkaert & Johan F.M. Swinnen & Thijs Vandemoortele, 2012. "Mega Events and Sports Institutional Development: The Impact of the World Cup on Football Academies in Africa," Chapters, in: Wolfgang Maennig & Andrew Zimbalist (ed.), International Handbook on the Economics of Mega Sporting Events, chapter 19, Edward Elgar Publishing.
    16. Brij Maharaj, 2015. "The turn of the south? Social and economic impacts of mega-events in India, Brazil and South Africa," Local Economy, London South Bank University, vol. 30(8), pages 983-999, December.
    17. Harry Walton & Alberto Longo & Peter Dawson, 2008. "A Contingent Valuation of the 2012 London Olympic Games," Journal of Sports Economics, , vol. 9(3), pages 304-317, June.
    18. Stefan Szymanski & Bastien Drut, 2020. "The Private Benefit of Public Funding: The FIFA World Cup, UEFA European Championship, and Attendance at Host Country League Soccer," Journal of Sports Economics, , vol. 21(7), pages 723-745, October.
    19. Ilya V. Solntsev, Andrey A. Kurov, 2024. "Sports Tournament Design as a Source of Economic Impact (Through the Example of Russian Premier League)," Journal of Applied Economic Research, Graduate School of Economics and Management, Ural Federal University, vol. 23(2), pages 304-340.
    20. P.A. Black, 2004. "Economic Impact Analysis: Methodological Note," South African Journal of Economics, Economic Society of South Africa, vol. 72(5), pages 1069-1075, December.
    21. Kavetsos, Georgios & Szymanski, Stefan, 2010. "National well-being and international sports events," Journal of Economic Psychology, Elsevier, vol. 31(2), pages 158-171, April.
    22. Christopher Vierhaus, 2019. "The international tourism effect of hosting the Olympic Games and the FIFA World Cup," Tourism Economics, , vol. 25(7), pages 1009-1028, November.
    23. Joanna Poczta & Agata Dąbrowska & Marek Kazimierczak & François Gravelle & Ewa Malchrowicz-Mośko, 2020. "Overtourism and Medium Scale Sporting Events Organisations—the Perception of Negative Externalities by Host Residents," Sustainability, MDPI, vol. 12(7), pages 1-24, April.
    24. Minhong Kim & Kyu Ha Choi & Becca Leopkey, 2021. "The influence of tourist risk perceptions on travel intention to mega sporting event destinations with different levels of risk," Tourism Economics, , vol. 27(3), pages 419-435, May.

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    More about this item

    Keywords

    Olympics; World Cup; Sports; Development Creation Date: 2003-03-15;
    All these keywords.

    JEL classification:

    • O2 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy
    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism

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