INFLUENCE OF HOSTING LARGE-SCALE SPORTING EVENTS ON ECONOMIC GROWTH: THE RESULTS OF EMPIRICAL ESTIMATION
In the modern literature there is no consensus concerning the effects in the countries due to hosting large-scale sport events such as Olympic games, FIFA World Cups and UEFA European Championships. From the macroeconomic point of view, organising a large-scale sporting event may foster economic growth in the host country due to large investment made by the government and corporate sector. Additionally, large-scale sporting events may facilitate different positive effects in the economy induced by an increase of tourist numbers, foreign trade growth and international investment. At the same time, the positive effects from hosting large-scale events may be constrained by a negative net financial outcome for the host country, low efficiency of the government investments comparing to private ones, as well as a low utilization rate of sports facilities and infrastructure after the event. Moreover, such indicators as greater involvement of the population into sporting activities and physical training, an improvement of the country’s image abroad and an increase in the share of people feeling proud for their country are very difficult to integrate into numerical analysis. The purpose of this paper is to estimate the influence of large-scale sporting events on the economic growth in the hosting countries. Based on the extended Solow model we do the empirical research using the database on 50 countries, 24 of which hosted 48 major sport events during 1970-2015. Exploring the effects for the developed and developing (transition) economies, we couldn’t find a stable relationship between hosting large-scale events and economic growth in the group of developed countries, while in the group of developing and transition economies we observe that economic growth accelerates both before and after the event. The results of this research may be used to justify bidding for hosting Olympic games, FIFA World Cups or UEFA European Championships, what underlines the practical importance of the research.