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Testing the accuracy of event economic impact forecasts

Girish M. Ramchandani (Sport Industry Research Centre, Sheffield Hallam University, Sheffield, UK)
Richard J. Coleman (Sport Industry Research Centre, Sheffield Hallam University, Sheffield, UK)

International Journal of Event and Festival Management

ISSN: 1758-2954

Article publication date: 1 June 2012

1894

Abstract

Purpose

The purpose of this paper is to examine the findings from ex ante and ex post economic impact appraisals of six major sports events. The ultimate aim of the paper is to identify the factors that cause differences between forecasts of direct expenditure and figures based on primary research.

Design/methodology/approach

A direct expenditure forecast for each event was derived based on analysis of event documentation and informed assumptions applied from previous studies. Subsequently, a comprehensive study was undertaken involving primary data collection and associated desk research.

Findings

Of the forecasts, three were inflated and three were conservative relative to the ex post figures. In total, two potential sources of variance are examined – visitor spending and organisational expenditure. The former was found to be more unpredictable when compiling a pre‐event forecast. The group for which direct expenditure is most difficult to predict is spectators, with the most exaggerated forecasts associated with free‐to‐view events.

Research limitations/implications

Neither input‐output nor computable general equilibrium models were used to analyse secondary, indirect or induced impacts. Nonetheless, direct expenditure is the basis for modelling wider impacts and is therefore worthy of consideration in its own right.

Practical implications

The paper's findings should enable public sector agencies to better understand the reliability of projected figures presented to them by organisers in exchange for securing financial support for their events.

Originality/value

Economic impact forecasts are rarely subjected to post‐event scrutiny. This research bridges the gap between ex ante and ex post figures and identifies areas where forecast accuracy can be improved.

Keywords

Citation

Ramchandani, G.M. and Coleman, R.J. (2012), "Testing the accuracy of event economic impact forecasts", International Journal of Event and Festival Management, Vol. 3 No. 2, pp. 188-200. https://doi.org/10.1108/17582951211229726

Publisher

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Emerald Group Publishing Limited

Copyright © 2012, Emerald Group Publishing Limited

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