South African Mega-sport Events and Their Impact on Tourism

Abstract

The 2010 Fédération Internationale de Football Association (FIFA) World Cup, one of the largest mega-sport events in the world, has stirred renewed interest in the benefits that a host country can derive from such events. While most predict a large increase in the number of tourist arrivals in South Africa during the event, recent international literature suggests that ex ante studies are often too optimistic. South Africa has played host to numerous mega-events since 1994. Using a time-series lagged regression model, we identify the increases in tourism numbers experienced for most such events, controlling for a number of variables, which are standard to the prediction of tourism flows. Smaller events, especially those held during the summer months, show little increase in tourist arrivals. We disaggregate tourism arrivals to show that, as expected, the number of tourists from participating countries tends to increase the most. Contrary to the findings revealed in the international literature, we find little evidence of between-country displacement. This lack of evidence may be as a result of off-season scheduling or because the relative size of such events reflects neither that of the FIFA World Cup nor that of the Olympic Games.

Keywords:

• Sport
• Tourist Arrivals
• World Cup
• Developing Countries
• Mega-event
• JEL Code
• L83
• F19

Acknowledgements

The authors would like to thank Gideon du Rand, Le Roux Burrows, Krige Siebrits, Robert Baade, Markus Kurscheidt, Wolfgang Maennig, Servaas van der Berg and the participants at the ‘Sport Mega Events and their Legacies’ Conference held in Stellenbosch, South Africa, in December 2009.

Notes

While sports administrators in scheduling events are often limited to specified windows of opportunity determined by the world governing body, especially for larger tournaments, a fair degree of flexibility is permitted for smaller events. The 1999 ICC Cricket World Cup, for example, took place between 14 May and 20 June, while the 2003 event, held in South Africa, ran from 9 February to 24 March. These movements are most notable for summer sports (i.e. cricket and the Summer Olympic Games), although the Rugby World Cup, usually held during September and October, was held in South Africa in 1995 from 25 May to 24 June.

In effect, ‘additionality’ refers to the difference between the event condition and the counterfactual condition.

The UK is Great Britain plus Northern Ireland. The British and Irish Lions represent the UK and the Republic of Ireland (as rugby is organised on an all-Ireland basis). The England cricket team is the cricket team of England and Wales (i.e. excluding Scotland and Ireland). We acknowledge potential contamination here and that our results may overstate or understate possible additionality or displacement.

An additional purpose of these robustness checks is to lower the possibility of strong multicollinearity in the explanatory variables.