Document Type

Article

Publication Date

2011

Publication Title

International Journal of Sport Finance

Volume

6

Issue

3

First Page

187

Last Page

203

Abstract

This paper empirically illustrates the difference between a standard economic impact analysis (EIA) and a cost-benefit analysis (CBA). The EIA was conducted using an existing (input-output) I-O model (STEAM). The benefit side of the CBA included non-local visitor spending, the revenue of the local organizing committee (LOC), the consumer surplus, and public good value of the sport event for the local residents. The cost side of the CBA was estimated based on the opportunity costs related to the construction of the stadium (including labor costs and the cost of borrowing), imports, and ticket sales to locals. The EIA indicated that the 2005 Pan-American Junior Athletic Championships generated a net increase in economic activity in the city of $5.6 million. The CBA showed a negative net benefit of $2.4 million. Both methods presented challenges and limitations, but CBA has the distinct advantage that it identifies the net benefits associated with hosting a sport event.

Comments

This article was first published in the International Journal of Sport Finance. Copyright (2012) Fitness Information Technology.

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