Hosting the FIFA World Cup™ Germany 2006

Abstract

Mega sport events, like the Olympic Games™ and the FIFA World Cup™, are the most important international tourism events. Although both events have a high attractiveness to international tourism, they are very different with regard to organization and hosting. On the one hand, there are the multi-sport competitions within the Olympic Games™, which are hosted 16 days within a national metropolis. On the other hand, there is the single-sport competition within the FIFA World Cup™, which is hosted one month nationwide in 10 to 12 major cities. Due to pre-event infrastructure investments as well as tourism consumption during the event phase, the regional economic impact consequentially spreads much more all over the country. Estimating these regional economic impacts normally is a difficult task. This paper presents some estimates of potential overall and regional economic effects on the German economy due to hosting the FIFA World Cup™ 2006. The results have been prepared using the dynamic interindustry-based macroeconomic simulation model SPORT (Ahlert, 2001), which has a special focus on analyzing sport-economic activities and events. The simulation results are based on a scenario that takes into account the necessary investments for upgrading the stadium facilities in the venues of the event as well as the tourism expenditure of incoming world cup visitors during the event in 2006. In a second step, it is explained how these overall economic effects can be transmitted to the regional level of the 16 German federal states by the dynamic regional-economic modeling system LANDER. The results show that it is possible to estimate the macroeconomic effects of the FIFA World Cup™ 2006 consistently on the overall national as well as regional level.