Local residents' monetary evaluation of sports events

Abstract

This study presents an empirical analysis from the World Championship in Skiing, hosted in Trondheim, Norway. Surveys focus on local residents' assessment of a major sport event and reveal that more than three out of four would have voted yes if a referendum was staged. This proportion was stable before and after the event. Peoples' monetary evaluation depended on how the question was framed. Ninety percent put a positive price tag on the event, according to the WTA (willingness to accept compensation for giving away the event)-approach, while 50% had a positive assessment of it according to the WTP (willingness to pay to host the event)- approach. The average WTA estimate was 43 times higher than the average WTP estimate. One explanation to this difference is that the impacts to a large extent are public goods. Another part of the difference is explained by Prospect Theory. Four regression models identified a limited number of significant variables that explain local residents' monetary evaluation. Most of these are related to a desire for a more social city life, rather than being related to positive economic impacts. A proposal left for future research is that this unusual domination of social factors over economic factors is related to the particular measurement of residents' evaluation (ratio scale) used in this study.