Critical reflections on the economic impact assessment of a mega-event: the case of 2002 FIFA World Cup

Sport tourism has received growing attention as a source of generating significant revenue and contributing major economic benefits to host cities, regions, and countries. However, current methods for assessing economic impact have had variable success in estimating tourist numbers and expenditure directly attributable to a sport tourism mega event. This paper reports on the assessment of one such event, the 2002 FIFA World Cup in South Korea, using an estimation method that excluded tourists whose travel was non-event related. The survey research conducted during the event established that 57.7% of total tourist arrivals during the period of the event could be classified as either directly and indirectly attracted by the World Cup. Using this data it was calculated that the World Cup generated an economic impact of US$1.35 billion of output (sales), US$307 million of income, and US$713 million of value added for South Korea. The results also showed that foreign World Cup tourists provided a much higher yield compared with foreign leisure tourists, spending an estimated 1.8 times as much. Inclusion of the expenditure by non-World Cup tourists (42.3%) in the calculations of impact would have resulted in a significant overestimation due to the further multiplication of the expanded figures by an input-output model, misleading the net economic impact of the event. The use of survey data to distinguish event from non-event tourists, and their respective expenditure, clearly illustrates some of the methodological pitfalls associated with forecasting that is simply based on generic tourist data. Furthermore, the data generated by this assessment of net direct expenditure and economic impact using the input-output analysis can be used as a comparison point for other mega sport events. In terms of further research, it is evident that existing models of impact assessment have not adequately conceptualized aversion and diversion effects and this begs the future inclusion of these concepts in economic impact forecasting for mega-events. (c) 2004 Elsevier Ltd. All rights reserved.