The review considered over 550 policy evaluations and evidence reviews from the UK and other OECD countries. It found 36 impact evaluations that met the Centre’s minimum standards.
Overall, the evidence suggests that the measurable economic effects on local economies tend not to have been large and are often zero. Facilities, however, can have a small positive impact on property prices nearby.
Sports and culture have intrinsic value to people and places as well as promoting health and wellbeing, cultural enrichment, and prestige and branding. In more recent decades, there has been an increasing tendency for promoters of investment in major sport and cultural events or facilities to claim that undertaking such projects will have demonstrable direct and indirect economic benefits as well. This report presents findings from a systematic review of evaluations of the economic impact of major sporting and cultural events and facilities (hereinafter referred to as ‘projects’).
Note on the evidence: major and small scale events
We initially focused the review on evaluations of sporting or cultural events and facilities of any size. However, we found no evaluations of small-scale events that met our minimum standards. Our findings are therefore based upon evaluations of major projects – but we believe they offer useful guidance for policymakers considering projects on any scale. We encourage local policymakers to build evaluation into their projects to contribute to the evidence base
What the evidence showed
- The overall measurable effects of projects on a local economy tend not to be large and are more often zero. Any wage and income effects are usually small and limited to the immediate locality or particular types of workers.
- Facilities are likely to have a positive impact on very local property prices. Policymakers should consider the distributional effects of these property market changes (who are the likely winners and losers).
- Projects may have been associated with increased trade imports and exports, including tourism, although these effects may be short lived (and are only considered in a small number of studies).
Where there was lack of evidence
- We found no impact evaluations that considered visitor numbers. Far more should be done to assess the extent to which projects lead to net increases in visitor numbers for the area as a whole. Visitor numbers for the project alone and surveys of attendees may not provide strong evidence on the impact of projects on net visitor numbers.
- There was a paucity of evidence regarding cultural projects overall. This is an issue for understanding the likely impact of such projects and also leaves a gap in our ability to compare the economic effects of sport projects and cultural projects.
- We found no robust evidence on the economic impacts of smaller projects (such as arts centres or small-scale festivals) – although based on what we found for large projects, we can assume that the economic impact of such projects would be even smaller.
- We found no robust evidence for the impact of recurring sport and cultural events, such as annual festivals or tournaments.
Below are some key points for policymakers to consider. You can also learn about our methodology and how to get the most out of our reviews by reading our guide.
- Almost all of the evaluations that we found to be rigorous are focused on projects at the grand end of the scale. However, we are confident that there are lessons for everyone facing this type of spending decision from the evidence we have looked at regarding these very large projects.
- It is important to have realistic expectations of what sports and cultural projects can achieve
- Facilities may be more likely to produce economic benefits than events, probably due to the longevity of their impact.
- Indirect employment effects are unlikely to be large, and focus should be on the direct employment effects generated by an event or facility. Reflecting this, time and expense can be saved by forgoing complex multiplier-based appraisal systems in lieu of solid ‘narrow’ evaluations.
- As the benefits of new facilities tend to be very localised and related to property prices and regeneration, they should be part of a broader strategy rather than seen as stand-alone projects. They should not be relied upon as the major component of a job creation strategy.
- Considered together the findings raise interesting questions about who should pay for sport and cultural events and facilities in any given locality. None of this should overshadow the other real if difficult-to-measure benefits