Fool's gold: major sport events and foreign direct investment

Abstract

Whether or not a city or a country should bid to host the Olympics or one of the big international football tournaments is often the source of heated debates. One question that is always raised is whether hosting such an event yields positive economic benefits. Using data from the period 1970-2009 we investigate whether there is a link between hosting a major sport event and the amount of foreign direct investment (FDI) a country receives. We employ time-series cross-section data for countries that have hosted either the Summer Olympics, the Winter Olympics, the FIFA World Cup or the UEFA European Championship in that period. While our overall results, on balance, offer support to the 'pessimistic' side of the debate about the economic effects of hosting mega events, our findings also indicate that some FDI benefits might still accrue to the host. Results are not unambiguous, however. More detailed analysis suggests that staging the Olympics has virtually no effect on FDI inflows, whereas hosting a major, nationwide football tournament might have a small positive impact on foreign investment, particularly in the years leading up to the event. These latter results seem to be driven by smaller nations.

Which Countries Bid for the Olympic Games? Economic, Political, and Social Factors and Chances of Winning

“…Hiller (2000) argues that more developed countries with less social issues might be more likely to make a bid, which is then not seen as a 'misplaced priority.' By contrast, Jakobsen et al (2013) find that smaller or less-developed countries generate more noticeable effects from hosting. In addition, potential bids might be concerned with their prospects of success.…”

Sociology and the ethnography of human rights at mega-sport events

“…What is more, the transnational flow of money and corporate interest – blessed by political arrangements – is part and parcel of the event becoming a reality. According to Jakobsen et al (2013: 367) the investments related to major sport events ‘are public procurements that in many instances are regulated by international agreements, such as the World Trade Organisation Agreement on Government Procurement, or the European Union’s rules on public procurement’. For example, for the 2010 World Cup in South Africa, Dutch-based construction firm Royal Bam built the Soccer City Stadium in Johannesburg, whereas India’s Mahindra Satyam provided IT services and technology for the event (Jakobsen et al, 2013: 367–368).…”

Political framing of sports: the mediated politicisation of Oslo’s interest in bidding for the 2022 Winter Olympics

“…The contrasting view was that one should not make a bid because sports are not that important, sporting events are not that fun, and it is not that important to stand out as a sporting nation (alternatively: research shows that organising sports events do not help very much for promoting a place (Jakobsen et al 2012)). As a result, the discussion is about the idea and value of sports, a recurrent theme in both public and private documents on sports.…”

“…Moreover, an interesting question is if there is a trend towards only special types of countries being applicants for such events, how does the Norwegian debate fit into and/or reflect such a trend. Another question of importance is also debates on the economic effects of hosting mega events (Jakobsen et al 2012).…”