Are sports events necessarily black holes for public finances? The case of Milan-Cortina 2026

Abstract

The objective of this paper is to explore whether huge public investments in international sports events necessarily turn out to be burdens for regional economies or not. This will be illustrated by estimating the economic and, in particular, the fiscal impact of the forthcoming Milan-Cortina 2026 Olympics on the economies and the public finances of the Veneto Region and on those of the Autonomous Provinces of Trento and Bolzano. To this end, we use an Input-Output (IO) analysis that we suitably modelled in order to measure also the specific impacts of the Olympic event on the national, regional and local tax systems. The paper will argue that in the case of international sports events, when prepared and managed carefully and also when their legacy is rooted in the regional economic systems from the start, the net effects of these events on the economy and on the public finances might be positive. It also tries to provide regional administrations, specifically referring again to the regional governments of the Veneto and Trentino-Alto Adige in particular, with a number of essential elements for a correct assessment of the socio-economic impact of this event and some suggestions on how the above-mentioned policies before, during and after the event, can help regional administrations to safeguard the collective interest through the hosting of international sports events.