How do Residents Contribute to Economic Impact?

What is it about?

In sports economic impact (EI) studies based on the direct expenditure approach (DEA), attendees are asked about their spending. Residents are typically excluded from event EI, although sometimes they are included if the event compels them spend more than they would have without the event. We show that there are actually 72 different ways a resident can affect impact (positive, negative, neutral, or indeterminant without more information). When we tested the model with an event, the positive and negative values mostly cancelled out, suggesting that it is optimal for residents to be excluded from EI studies.

Featured Image

Photo by Angie J on Unsplash

Photo by Angie J on Unsplash

Why is it important?

Past economic impact (EI) studies using the direct expenditure approach (DEA) typically gather only the amount of spending. We show that any study that fails to gather FOUR variables is incomplete and will result in a misleading estimate of impact. The four variables that must be gathered for every person are: (a) the amount of spending, (b) the multiplier of the industry they spent it in, (c) the timing of their expenditures, and (d) the geographic location of their spending.