What Are the Benefits of Hosting a Sporting Mega Event? Evidence From Industrial Firms in China

in Journal of Sport Management
View More View Less
  • 1 New York University
  • | 2 Aston University
Restricted access

Purchase article

USD  $24.95

Student 1 year online subscription

USD  $87.00

1 year online subscription

USD  $116.00

Student 2 year online subscription

USD  $166.00

2 year online subscription

USD  $221.00

It is acknowledged that the economic benefits of hosting a sporting mega event are overestimated and/or short lived. However, many studies neglect the impact of the industrial sector, preferring to focus on service sector activity. It is further claimed that hosting a sporting mega event funnels a nation’s resources into one specific region at the expense of others. Therefore, this article empirically investigates whether industrial firms in Beijing disproportionately (a) increased their invested capital ahead of the 2008 Olympic Games and (b) became more profitable after the Games relative to similar firms from comparable Chinese nonhost cities. Using a difference-in-difference estimation strategy, the authors find no disproportionate impact of the Olympic Games on Beijing firms’ invested capital or profitability.

Hayduk is with New York University, New York, NY, USA. Rewilak is with Aston Business School, Aston University, Birmingham, United Kingdom.

Hayduk (ted.hayduk@nyu.edu) is corresponding author.
  • Akerlof, G.A., & Shiller, R.J. (2010). Animal spirits: How human psychology drives the economy, and why it matters for global capitalism. Princeton, NJ: Princeton University Press.

    • Search Google Scholar
    • Export Citation
  • Allmers, S., & Maennifg, W. (2009). Economic impacts of the FIFA Soccer World Cups in France 1998, Germany 2006, and outlook for South Africa 2010. Eastern European Journal, 35(4), 500519. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Baade, R., Baumann, R., & Matheson, V. (2021). Mega-events and tourism: The case of the 2014 FIFA World Cup and the 2016 Rio Summer Olympic Games. In K. Stefan, K. Ruud, & P. Levi (Eds.), A modern guide to sports economics. Cheltenham, UK: Edward Elgar.

    • Search Google Scholar
    • Export Citation
  • Baade, R.A., & Matheson, V. (2002). Bidding for the Olympics: Fool’s gold? In P. Carlos, I. Muradali, & S. Stefan (Eds.), Transatlantic sport: The comparative economics of North American and European Sports (pp. 127151). London, UK: Edward Elgar Publishing.

    • Search Google Scholar
    • Export Citation
  • Baade, R.A., & Matheson, V.A. (2004). The quest for the cup: Assessing the economic impact of the world cup. Regional Studies, 38(4), 343354. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Baade, R.A., & Matheson, V.A. (2016). Going for the gold: The economics of the Olympics. Journal of Economic Perspectives, 30(2), 201218. doi:

  • Baumann, R., & Matheson, V. (2018). Mega events and tourism: The case of Brazil. Contemporary Economics Policy, 36(2), 292301. doi:

  • Billings, S., & Holladay, J. (2012). Should cities go for the gold? The long term impacts of hosting the Olympics. Economic Inquiry, 50(3), 754772.

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Brückner, M., & Papa, E. (2015). News shocks in the data: Olympic games and their macroeconomic effects. Journal of Money, Banking and Credit, 47(7), 13391367. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Burgess, R., Jedwah, R., Morjaria, A., & Pador I Miquel, G. (2015). The value of democracy: Evidence from road building in Kenya. American Economic Review, 105(6), 18171851. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Card, D., & Kruger, A. (1994). Wages and employment: A case study of the fast-food industry in New Jersey and Pennsylvania. American Economic Review, 84, 772793.

    • Search Google Scholar
    • Export Citation
  • Chaudhary, L., & Rubin, J. (2016). Religious identity and the provision of public goods: Evidence from the Indian Princely States. Journal of Comparative Economics, 44(3), 461483. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Chen, S., & Misener, L. (2019). Event leveraging in a non-host region: Challenges and opportunities. Journal of Sport Management, 33(4), 275288. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Chen, S., Preuss, H., Hu, X., Kenyon, J., & Liang, X. (2019). Sport policy development in China: Legacies of Beijing’s 2008 Summer Olympic Games and 2022 Winter Olympic Games. Journal of Global Sport Management. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Chen, S., Yan, X., & Yang, B. (2020). Move to success? Headquarters relocation, political favouritism and corporate performance. Journal of Corporate Finance, 64.

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Chen, Y., Henderson, V., & Wei, C. (2017). Political favouritism in China’s capital markets and its effects on city sizes. Journal of Urban Economics, 98, 6987. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Cieslik, A., & Kaniewska, M. (2004). Telecommunications infrastructure and regional economic development: The case of Poland, Regional Studies, 38, 713725.

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Coates, D. (2006). The tax benefits of hosting the Super Bowl and the MLB All-Star game: The Houston experience. International Journal of Sport Finance, 1(4), 239252.

    • Search Google Scholar
    • Export Citation
  • Coates, D., & Depken, C.A. (2011). Mega-events: Is the Texas-Baylor game to Waco what the Super Bowl is to Houston? Journal of Sports Economics, 12(6), 599620. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Coates, D., & Humphreys, B.R. (2002). The economic impact of postseason play in professional sports. Journal of Sports Economics, 3(3), 291299. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Dai, R. (2012). International accounting databases on WRDS: Comparative analysis. SSRN. Retrieved from https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2938675

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Dansero, E., & Puttilli, M. (2010). Mega-events tourism legacies: the case of the Torino 2006 Winter Olympic Games—A territorialisation approach. Leisure Studies, 29(3), 321341. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Davis, J. (2020). Avoiding white elephants? The planning and design of London’s 2012 Olympic and Paralympic venues, 2002–2018. Planning Perspectives, 35, 827848.

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Demurger, S. (2001). Infrastructure development and economic growth: An explanation for regional disparities in China? Journal of Comparative Economics, 29, 95117.

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Depken, C., & Fore, B. (2020). Firm-level economic activity before, during and after local events: A case study. Journal of Sports Economics, 21(4), 327334. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Depken, C., & Stephenson, E.F. (2018). Hotel demand before, during and after sports events: Evidence from Charlotte, North Carolina. Economic Inquiry, 56(3), 17641776. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Dollinger, M.J., Li, X., & Mooney, C.H. (2010). Extending the resource‐based view to the mega‐event: Entrepreneurial rents and innovation. Management and Organization Review, 6(2), 195218. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Donaldson, D. (2018). Rise of the Raj: Estimating the impact of transportation infrastructure. American Economic Review, 108(4–5), 899934. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Feddersen, A., & Maennig, W. (2012). Sectoral labour market effects of the 2006 FIFA World Cup. Labour Economics, 19(6), 860869. doi:

  • Gottwald, J.-C., & Duggan, N. (2008). China’s economic development and the Beijing Olympics. International Journal of the History of Sport, 25(3), 339354. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Hair, J.F., Black, W., Babin, B., & Anderson, R. (2018). Multivariate data analysis (8th ed.). New York, NY: Cengage Learning.

  • Holder, R., & Raschky, P. (2014). Regional favouritism. Quarterly Journal of Economics, 129(2), 9951033.

  • Hong, J., Chu, Z., & Wang, Q. (2011). Transport infrastructure and regional economic growth: Evidence from China, Transportation, 38(5), 737752. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Hotchkiss, J.L., Moore, R.E., & Zobay, S.M. (2003). Impact of the 1996 Summer Olympic Games on employment and wages in Georgia. Southern Economic Journal, 3, 691704. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Jedwab, R., Kerby, E., & Maradi, A. (2017). History, path dependence and development: Evidence from colonial railways, settlers and cities in Kenya. The Economic Journal, 127(603), 14671494. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Lamla, M., Straub, M., & Girsberger, M. (2014). On the economic impact of international sporting events: Microevidence from survey data at the Euro 2008. Applied Economics, 46(15), 16931703. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Li, S., Blake, A., & Cooper, C. (2011). Modelling the economic impact of international tourism on the Chinese economy. A CGE analysis of the Beijing 2008 Olympics. Tourism Economics, 17(2), 279303.

    • Search Google Scholar
    • Export Citation
  • Li, S., Blake, A., & Thomas, R. (2013). Modelling the economic impact of sports events: The case of the Beijing Olympics. Economic Modelling, 30, 235244. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Li, S., & Song, H. (2013). Economic impacts of visa restrictions on tourism: A case of two events in China. Annals of Tourism Research, 43, 251271. PubMed ID: 32572287 doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Matheson, V. (2008). Mega-events: The effect of the world’s biggest sporting events on local, regional, and national economies. In H. Dennis& H. Brad (Eds.), The business of sports (Vol. 1, pp. 8199). Westport, CT: Praeger Publishers.

    • Search Google Scholar
    • Export Citation
  • Matheson, V.A., & Baade, R.A. (2005). Striking out? The economic impact of major league baseball work stoppages on host communities (Working Papers 0507). Worcester, MA: Department of Economics, College of the Holy Cross.

    • Search Google Scholar
    • Export Citation
  • Myers, R. (1990). Classical and modern regression with applications. Boston, MA: Duxbury Press.

  • Okada, I., & Greyser, S. (2018). After the carnival: Key factors to enhance Olympic legacy and prevent Olympic sites from becoming white elephants (Working Paper no. 09-19). Cambridge, MA: Harvard Business School, Harvard University.

    • Search Google Scholar
    • Export Citation
  • Porter, P. (1999). Mega-sports events as municipal investments: A critique of impact analysis. In J. Fizel, E. Gustafson, & L. Hadley (Eds.), Sports economics: Current research (pp. 6173). New York, NY: Praeger Press.

    • Search Google Scholar
    • Export Citation
  • Porter, P., & Fletcher, D. (2008). The economic impact of the Olympic Games: Ex ante predictions and ex post reality. Journal of Sport Management, 22(4), 470486. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Preuss, H. (2004). The economics of staging the Olympics: A comparison of the Games, 1972–2008. Cheltenham, UK: Edward Elgar Publishing.

    • Search Google Scholar
    • Export Citation
  • Preuss, H. (2006). The Olympics. In A . Wladimir& S. Stefan (Eds.), Handbook on the economics of sort (Chapter 17). Cheltenham, UK: Edward Elgar Publishing.

    • Search Google Scholar
    • Export Citation
  • Preuss, H., & Solberg, H. (2006). Attracting major sporting events: The role of local residents. European Sport Management Quarterly, 6(4), 391411. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Ren, X. (2008). Architecture and nation building in the age of globailization: Construction of the national stadium of Beijing for the 2008 Olympics. Journal of Urban Affairs, 30(2), 175190. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Rose, A., & Spiegel, M. (2011). The Olympic effect. The Economic Journal, 121(553), 652677. doi:

  • Rudkin, S., & Sharma, A. (2020). Live football and tourism expenditure: Match attendance effects in the UK. European Sport Management Quarterly, 20(3), 276299. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Schanbl, P. (2012). The international transmission of bank liquidity shocks: Evidence from an emerging market. Journal of Finance, 67, 897932.

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Shin, H.B. (2009). Life in the shadow of mega-events: Beijing Summer Olympiad and its impact on housing. Journal of Asian Public Policy, 2(2), 122141. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Solberg, H., & Preuss, H. (2007). Major sporting events and long-term tourism impacts. Journal of Sport Management, 21(2), 213234. doi:

  • Street, N., & Matelski, M. (2019). American Businesses in China: Balancing culture and communications (3rd ed.). Jefferson, NC: McFarland and Company.

    • Search Google Scholar
    • Export Citation
  • Szymanski, S. (2010). The economic impact of the World Cup. Football economics and policy. London, UK: Palgrave Macmillan.

  • Teigland, J. (1999). Mega-events and impacts on tourism: The predictions and realities of the Lillehammer Olympics. Impact Assessment and Project Appraisal, 17(4), 305317. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Tien, C., Lo, H., & Lin, H. (2011). The economic benefits of mega events: A myth or a reality? A longitudinal study of the Olympic Games. Journal of Sport Management, 25(1), 1123. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Ulbricht, N., & Weiner, C. (2005). Worldscope meets Compustat: A comparison of financial databases. SSRN. Retrieved from https://papers.ssrn.com/sol3/papers.cfm?abstract_id=871169.

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Vierhaus, C. (2019). The international tourism effect of hosting the Olympic Games and FIFA World Cup. Tourism Economics, 25(7), 10091028. doi:

    • Crossref
    • Search Google Scholar
    • Export Citation
  • Zhu, L., & Cai, Y. (2016). Institutions and provision of public goods in Rural China: An empirical study based on villages in Guangdong Province. China Review, 16(2), 5583.

    • Search Google Scholar
    • Export Citation
All Time Past Year Past 30 Days
Abstract Views 210 210 86
Full Text Views 11 11 2
PDF Downloads 12 12 2