The bidding paradox: why rational politicians still want to bid for mega sports events
AbstractThis paper discusses reasons why politicians still favor hosting mega events despite the discouraging evidence regarding their financial benefits: (1) early political enthusiasm, (2) tying side-projects to the bid to raise political support, (3) biased reading of history, (4) the winners curse, (5) redistribution and lobbying, (6) a media bias in favor of hosting and (7) boosting happiness and pride of residents. Bringing happiness to the people might be a valid reason for hosting a mega event, however, economists are yet insufficiently capable of capturing this effect. Moreover, alternative explanations for political support cannot be deemed invalid ex ante.
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Bibliographic InfoPaper provided by Utrecht School of Economics in its series Working Papers with number 13-08.
Length: 30 pages
Date of creation: Aug 2013
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Find related papers by JEL classification:
- D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
- D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
- H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures
- L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-09-06 (All new papers)
- NEP-HAP-2013-09-06 (Economics of Happiness)
- NEP-POL-2013-09-06 (Positive Political Economics)
- NEP-PPM-2013-09-06 (Project, Program & Portfolio Management)
- NEP-SPO-2013-09-06 (Sports & Economics)
- NEP-TUR-2013-09-06 (Tourism Economics)
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