The ability of sporting, cultural and business events to add value to their host economies is one of the main drivers of interest in staging them.
Being able to demonstrate the scale and nature of these economic impacts is therefore crucial for most events – both to quantify their return on public sector stakeholders’ investment and build a case for supporting future editions or developing a broader hosting portfolio.
The basis of economic impact is the net monetary value an event delivers for its host economy. We calculate this by measuring cash inflows and outflows attributable to the event and subtracting the latter from the former.
Types of economic impact
Direct economic impact is the most immediate measure of the cash value of any event. It comprises the ‘first-round’ spending generated by its staging; e.g. a visitor buying a meal in a local restaurant.
Total economic impact is a broader measure that adds the ‘knock-on’ benefits to the local economy created by the initial direct event spending; e.g. the additional money spent locally by the restaurant as a result of the extra business it gained from event visitors.
Business and employment impacts are another way in which events can contribute to their host economies, primarily through job creation, skills development and attracting new inward investment.
Long-term economic impacts can also be generated by larger events; e.g. through associated infrastructure investments or new trading relationships built on the back of them.
Measuring economic impact
This section of the eventIMPACTS toolkit will help you start measuring your event’s contribution to its host economy.
It includes an online calculator you can use to forecast approximate economic impact, and highlights the key indicators recommended by the Organisation for Economic Co-Operation and Development (OECD) and by the Association of Summer Olympic International Federations (ASOIF), as well as their contribution to the United Nations’ Sustainable Development Goals (SDGs).