In the quadrennial competition to secure mega-events such as the Olympics and political conventions, the economic benefit to host cities is regularly flaunted. Carl Bialik looks at why big events may not mean big bucks for their host cities.
London can certainly brag about hosting a well run and memorable Olympics this summer, but according to several economic observers interviewed by Bialik, claims to "a long-term economic boost of anywhere from $20 billion to $26 billion for the U.K." are quite dubious. Ditto for the host committees for the Democratic and Republican conventions to be held this summer who are
expecting "Charlotte, N.C., and Tampa, Fla., each to benefit to the tune
of between $150 million and $200 million this year."
"Playing the role of party poopers are several economic observers who
have gone back to study tax receipts and other signs of extra activity
from earlier, similar mega-events, and generally haven't found much to
crow over," writes Bialik.
Predicting economic impacts is a notoriously inexact science, so projections should be given a measure of leeway. However looking backwards, notes Bialik, one study conducted by Robert A. Baade, an economist at Lake Forest College in Illinois, and colleagues, "agrees that these gains rarely
show up."
"The researchers studied 18 national political conventions
between 1972 and 2004, and found no statistically significant impact on
personal income or local employment when comparing host cities with
control cities that didn't host events."
FULL STORY: Why Mega-Events May Not Mean Mega-Bucks

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