Economics in Sports

Over past years there has been an on going debate as to whether or not hosting so called “mega sporting events” is beneficial to the hosting nation and cities, either economically or socially. In the early years of mega events the view that hosting one of these events was an economic burden was the view of almost everybody who mattered. However after a profit of $ 200 million profit was generated by the 1984 Los Angeles Olympics, many peoples view’ changed. According to Matheson and Baede 2002, “The prevailing perception seems to be that a properly run Olympics generates millions, if not billions of dollars in profit for the host nation”. (Matheson and Baede, 2002) In 1984 Los Angeles was the sole bidder for the Olympics, today cities fight for the chance to host these mega events because usually of the promise of a financial windfall. Does this potential economic windfall justify the substantial costs and risks? There are many people and sources who view staging these events as a chance to change the fortunes of the hosting city, but equally there are still many who say these events bring along with them to many problems both economical and social. The aim of this assignment will be to investigate and analyse mega sporting events and evaluate and conclude on whether or not hosting these events actually bring with them social and economical advantages or disadvantages. Examples of mega event such as the European football championships, the football world cup and the Olympic games will be used and examined to see how the host nations and cities have been either positively or negatively effected, both economically and socially, over the years. After this analysis of these events has been completed, an overall perspective on whether or not the positive impacts outweigh the negative impacts will be formed. This will be the basis for the final conclusion and will help answer the assignment question. Many sources will be used to help reach the final conclusion,