A Theoretical Comparison of the Economic Impact of Large and Small Events

Abstract

In response to the increasing debate on the relative worth of small events compared to large events, we create a theoretical model to determine whether smaller events are more likely to create positive economic impact. First, event size and city size are redefined as continuums of resources. The concepts of event resource demand (ERD) and city resource supply (CRS) are introduced, allowing for a joint analysis of supply and demand. When local economic conditions are brought into the analysis, the framework determines how a city resource deficiency or surplus affects the economic impact of an event. This resource based approach assists public officials and event organizers in making more rational decisions for hosting events when they pursue positive economic impacts. Specifically, we find small events have a higher potential for positive economic impact and hosting multiple smaller sized events is a better strategy than hosting a big event.

Keywords: Economic impact, cost benefit analysis, demand, event typology, large event, small event