Abstract

The FIFA World Cup is a billion-dollar event, with the most recent event, the 2018 FIFA World Cup Russia, generating $6 billion in revenue. However, despite the host countries incurring billions of dollars in costs to build and renovate sporting facilities and infrastructure, the profits are given back to the organizing body, not the host country. The rights to host these large-scale, international events are advertised as a catalyst for economic growth. However, previous literature shows hosting international mega-sporting events does not yield enough short-term revenue increases in the host country to offset the cost of staging and hosting the event, nor do they produce significant economic development for the hosts. Considering that hosts do not receive the profits and the lack of economic growth, as concluded by previous studies, it is surprising that countries are still bidding to host these events. There must be other benefits to hosting, and it is important to identify what they might be. Since hosts make significant investments in their infrastructure, it is reasonable that these investments are where the long-term economic growth occurs. Higher quantity and quality of infrastructure reduce the cost of trade, encouraging countries to engage in trade more. The current study uses UN Comtrade and CEPII data and a fixed-effects gravity model to determine the effects hosting the FIFA World Cup has on the host country’s exports. Regression results show that hosting the FIFA World Cup increases the host’s exports by 8.44% for the five years after hosting the event. Although the findings of the current study are not consistent with that of previous research, the results show that there are still long-term benefits to hosting the FIFA World Cup for the host country.