The Total Economic Value of Sporting Events Theory and Practice

Abstract

The production and consumption of the sporting event generates not only positive externalities (social peace and social links, etc.), butalso negative ones (hooliganism and doping, etc.). Therefore, it is necessary to try to internalize these external effects and determine the total economic value of the sporting event, which would measure the real net social utility created. On this basis, it would be possible to decide whether sporting events deserve to be subsidised—and at whatlevel. More than the general principle that the economic calculation can provide to make a decision, such a determination of the total economic value of a sporting event poses formidable methodological problems. In the case study presented, the authors believe they have reduced many of the biases attached to the travel costs method and contingent valuation method. However, faced with the shortcomings of the cost/benefit method (even when expanded), it is nowadays recommended to resort to a deliberative approach with a view to providing some help in making a decision.