Although some countries and cities have managed to profit from well-run major sports events such as the FIFA World Cup and the Olympics, they’re far from the norm, a prominent professor of economics says.
Victor Matheson, a professor of economics at the College of the Holy Cross in Newton, Mass., says prospective hosts need to think twice about whether the massive outlays of cash are worth it in the long run.
“The economic benefit is typically zero,” Matheson says in an interview set to air on CBC’s Lang & O’Leary Exchange on Tuesday. And even when there is a modest gain, “it’s not enough to justify the price tag,” he says.
I think we know who to blame
Because the IOC and FIFA make their money from selling TV and merchandising rights, they have no incentive to keep costs from ballooning, Matheson says.
“On paper, the IOC and FIFA don’t care whether it costs $51 billion to host the Olympics in Sochi or $14 billion to host the World Cup in Brazil, because ‘I’m not paying those costs,'” Matheson says.