Economic Impact of Mega Sporting Events on Host Country

Abstract

Mega sporting events such as Summer Olympic Games and World Cup have mass popular appeal and international significance. However, there are academic controversies over whether these events could have a measurable and long-lasting contribution to the host country. This paper will empirically measure the direction and magnitude of the effect of hosting such events, by utilizing a panel data set consisting of 132 countries over 1960-2016. We also incorporated qualitative economic indexes indicating the macroeconomic, regulatory and legal environment of the host countries into the model to figure out certain features which can help generate a more favorable economic outcome. The results show that Summer Olympic Games is the only mega events that exert an overall positive influence on the economy, and those countries with weak economic fundamentals significantly benefit from hosting mega sporting, while high-quality regulatory and legal environment is essential to preserve the positive legacy effect of the events.