Old questions, new methods: Revisiting the economic effects of hosting mega-sport events

The economic benefits of hosting mega-sport events have been widely debated. However, empirical evidence on their overall impact on economic activity remains inconclusive, largely due to methodological challenges. This study analyses the economic impact of the two largest mega-sport events, the Summer Olympic Games (SOGs) and FIFA World Cup (WC), on international tourist arrivals, GDP per capita, and the share of employment and value added in the tertiary sector. Using a panel dataset from 1991 to 2023, we provide causal estimates through dynamic difference-in-differences estimators. Considering suitable control groups, we distinguish between anticipation and legacy effects, account for staggered treatment timing, and accommodate heterogeneous treatment effects. Results indicate moderate anticipatory effects on tourism and notable impacts on employment and GDP per capita, with the SOGs exhibiting a stronger impact. These findings provide a nuanced understanding of the economic consequences of hosting mega-sport events and highlight the limitations of standard approaches.