The Olympic Effect

26 Pages Posted: 6 Jun 2011

See all articles by Andrew Kenan Rose

Andrew Kenan Rose

University of California - Haas School of Business; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR)

Mark M. Spiegel

Federal Reserve Bank of San Francisco - Economic Research Department

Multiple version iconThere are 3 versions of this paper

Date Written: June 2011

Abstract

Why should countries offer to host costly ‘mega‐events’ such as the Olympic Games? We show that hosting a mega‐event increases exports. This effect is statistically robust, permanent and large; trade is over 20% higher for host countries. Interestingly, unsuccessful bids to host the Olympics have a similar impact on exports. We conclude that the Olympic effect on trade is attributable to the signal a country sends when bidding to host the games, rather than the act of actually holding a mega‐event. We develop an appropriate formal model and derive conditions under which liberalising countries will signal through a mega‐event bid.

Suggested Citation

Rose, Andrew Kenan and Spiegel, Mark M., The Olympic Effect (June 2011). The Economic Journal, Vol. 121, Issue 553, pp. 652-677, 2011. Available at SSRN: https://ssrn.com/abstract=1857331 or http://dx.doi.org/10.1111/j.1468-0297.2010.02407.x

Andrew Kenan Rose (Contact Author)

University of California - Haas School of Business ( email )

Berkeley, CA 94720
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510-642-6609 (Phone)
510-642-4700 (Fax)

HOME PAGE: http://faculty.haas.berkeley.edu/arose

National Bureau of Economic Research (NBER)

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Centre for Economic Policy Research (CEPR)

London
United Kingdom

Mark M. Spiegel

Federal Reserve Bank of San Francisco - Economic Research Department ( email )

101 Market Street
San Francisco, CA 94105
United States
415-974-3184 (Phone)
415-974-2168 (Fax)

HOME PAGE: http://www.frbsf.org/economics/economists/mspiegel.html

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