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The economic impact of major sports events: a case study of Sheffield DOBSON, Nigel Available from the Sheffield Hallam University Research Archive (SHURA) at: http://shura.shu.ac.uk/3173/ A Sheffield Hallam University thesis This thesis is protected by copyright which belongs to the author. The content must not be changed in any way or sold commercially in any format or medium without the formal permission of the author. When referring to this work, full bibliographic details including the author, title, awarding institution and date of the thesis must be given. Please visit http://shura.shu.ac.uk/3173/ and http://shura.shu.ac.uk/information.html for further details about copyright and re-use permissions. REFERENCE Fines are charged at 50p per hour 2 1 JUL9 1 mi 2006JUO ?nni; / i 'Z J \ \ ° D 1 < JUL ( ± .o \p 2 8 JUL 2006 3 0 M AR 200? U - ' o 3 , 2. 9 JUL 2006 v 2 8 SEP 2006^0^ > z APR 200? A L-V-P' 3 0 OCT 2006 yt ~ - 8 FEB 200? ' 5 JUL ^ C: '2. IT 'I t / j u \ ? "? 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Box 1346 Ann Arbor, Ml 48106- 1346 The Economic Impact of Major Sports Events: A Case Study of Sheffield Nigel Dobson A thesis submitted in partial fulfilment of the requirements of Sheffield Hallam University For the degree of Doctor of Philosophy December 2000 Collaborating Organisation: Sheffield City Council I ) ! ABSTRACT In the mid-to-late 1980's, so called 'rust belt' cities in the UK began to respond to their industrial decline with local economic development strategies aimed at boosting employment. The strategies involved efforts to diversify traditional manufacturing heartlands into new service sector economies. One feature of the approach was the often rather implausible looking project of creating, out of unpromising material, a new urban sport and tourism industry (Roche 1992b). Faced with economic and industrial decline in the 1980’s, Sheffield, traditionally a manufacturing and steel producing city, forged sport and tourism together as an alternative solution to regenerate its local economy. It was believed that investment in sporting infrastructure, and the staging of the XVI World Student Games would derive long-term economic and social benefits to all sections of the community (Price 1991). Criticised as reactive and quasi-strategic at the time, the longer-term assessment of these radical investment decisions has been overlooked. The value, role and function of major events in the local UK economic development process is Therefore less than fully understood. Challenging the traditional economic base theory relationship between the manufacturing and service sectors of an economy, this thesis investigates whether investment in major events has been a rational approach to assist Sheffield’s process of economic development. Utilising Williams’ (1997) hypothesis that major events act as basic economic activities; by attracting and retaining external expenditure from sports tourists, the aim of the thesis is to identify whether events act as ‘catalysts’ to or ‘motors’ of local economic growth. Through the application of an expenditure based multiplier approach, five major events, staged in Sheffield between 1996 and 1998, are estimated to have had a collective impact of £10.4 million over a period of twenty-one event days (£495,00 per day). The findings of the research reveal that the staging of major sports events has a significant short-term impact on the local economy. The impact is conditional upon the type, status and duration of the event staged and the , nature of the visitor groups attracted. Extrapolating the results to all events staged in Sheffield since 1990, the thesis estimates that nearly £32 million has been injected into the local economy. On the basis of the results, the research argues that major events are an important part of the consumer service sector of a local economy. As consumer services they act to stimulate economic growth by importing consumers. While major events are shown to function as basic sector economic activities and catalysts, they are not in themselves large enough to ‘motor’ a local economy, but are key instruments in diversifying the local economic base. In conclusion, the thesis recognises that the academic assessment of major events in the UK is relatively immature, and it highlights the need for rigorous evaluation of the broader cost-benefit parameters associated with staging major events. Sporting, cultural, political, social and environmental impacts of major events are a few of the themes highlighted as areas of future research. CONTENTS 1. CHAPTER ONE - INTRODUCTION 1.1 Introduction 1 1.2 Background to the Study 3 1.3 Aims and Objectives 9 1.4 Overview 12 2. CHAPTER TWO - POLICY CONTEXT 2.1 Introduction 14 2.2 The Influence of Global Economic Forces on Urban Policy 15 2.3 The International Sports Policy Context 19 2.3.1 The North American Approach to Regeneration 19 2.3.2 Understanding the Positive and Negative Impacts of Major Events 23 2.4 The UK Policy Perspective on Sport 25 2.4.1 Central Government and Sports Council Policy 25 2.4.2 The Developing Major Events Policy of the Sports Councils 32 2.4.3 Local Policy Development and Sport 34 2.4.4 The National Governing Bodies of Sport 38 2.5 Overview 39 3. CHAPTER THREE - CITY OF STEEL TO CITY OF SPORT 3.1 Introduction 42 3.2 The Development of Sport in Sheffield 1960-2000 43 3.2.1 The Growing Importance of Sport: 1960-1973 44 3.2.2 Sport as a Social Tool: 1974-1985 46 3.2.3 The Declining Manufacturing Base 47 3.2.4 Sport and Economic Regeneration: 1985-2000 50 3.3 The World Student Games 1991 54 3.4 The Economic Forecasts and Political Justification 55 3.5 The Impact of the Games 57 3.6 The Perceived Outcomes 60 3.6.1 The Various Impacts 61 3.6.2 The Development of a Major Events Strategy in Sheffield 64 3.6.3 Sport and the Role of the Consumer Sector in Sheffield 65 3.7 Overview 67 4. CHAPTER FOUR - SPORT, TOURISM AND ECONOMIC DEVELOPMENT 4.1 Introduction 69 4.2 The Economic Base Model 70 4.3 The Changing Role of Consumer Services: Tourism and Sport 75 4.4 The Economics of Sport 77 4.4.1 The Value of Sport 78 4.5 Major E vents-A Tool in Economic Development Strategies? 81 4.5.1 A Conceptual Definition of Major Events 81 4.5.2 The Secondary Objectives of Staging Major Events 85 4.5.3 The Costs and the Benefits 87 4.5.3.1 The Real Costs 89 4.5.3.2 The Perceived Benefits 92 4.6 Overview 95 CHAPTER FIVE - ANALYTICAL FRAMEWORK 5.1 Introduction 98 5.2 A Methodological Review 99 5.2.1 The Expenditure Based Multiplier Approach 100 5.2.2 The Input-Output Approach 103 5.2.3 Cost-Benefit Analysis 104 5.3 The Aim of an Economic Impact Study 105 5.4 The Significance of Economic Impact Assessment 106 5.5 Economic Impact Study Variables 108 5.6 A Critique of Economic Impact Methodology 108 5.7 The Justification for Measuring the Economic Impact of an Event 112 5.8 Overview 113 CHAPTER SIX - METHODOLOGY 6.1 Introduction 115 6.2 Understanding the Methodology 116 6.3 The Expenditure Based Multiplier Approach 117 6.4 The Case Study Events 119 6.4.1 The European Football Championships 1996 120 6.4.2 The VIFINA World Masters Swimming Champs 1996 121 6.4.3 The English Schools Athletic Championships 1996 122 6.4.4 The IAAF Grand Prix Athletics 1 1997 122 6.4.5 The European Short Course Swimming Champs 1998 123 6.5 The Methodology 124 6.5.1 A Step By Step Approach 124 6.5.2 Phase One - Pre-Event Planning and Establishing Contacts 125 6.5.3 Phase Two - Pre-Event Evaluation and Action Planning 127 6.5.4 Phase Three - Primary Data Collection 129 6.5.4.1 The Main Survey Instrument 130 6.5.4.2 The Sampling Methodology 131 6.5.4.3 The Survey Stages 133 6.5.5 Phase Four - Post-Event Data Analysis 137 6.5.5.1 Analysing Secondary Non - Survey Data 138 6.5.6 Phase Five - Multiplier Analysis 139 6.6 Overview 140 7. CHAPTER SEVEN - RESULTS: SECTION ONE 7.1 Introduction 142 7.2 The European Football Championships in Sheffield 143 7.3 The Sampling Frame 144 7.4 Visitor Profiles 147 7.5 Economic Impact: Direct Expenditure 150 7.5.1 Expenditure Patterns 150 7.5.2 The Follow-Up Survey 154 7.5.3 The Wider Economic Benefits 156 7.6 The Accommodation Sector 157 7.6.1 Total Bed-nights 158 7.6.2 Accredited Personnel 159 7.6.3 Hotel Accommodation in the City 159 7.7 The Retail, Food and Drink Sector 163 7.8 The Multiplier 164 7.9 Overview 165 8.