Dr Richardson, who researched public spending on major sporting events for his PhD, says the $507m to $700m bandied about is a lofty and unrealistic figure.I don't know anything about the netball championships or the motor race, but I'd be surprised if any substantial public funds went into the 2005 tour.
His study of 11 major sporting events in New Zealand found only three had any significant positive effect on the local host economy’s gross domestic product during the event itself – the 1999 Netball World Championship in Christchurch, the A1GP motor race in Taupo and the 2005 British and Irish Lions rugby tour.
“Maybe the Government shouldn’t talk about economic impact,” he says. “I do not think we should be using economic impact as a justification for hosting sporting events. Maybe we should forget the magic figures and focus on the long-term benefits.”If warm fuzzies are the potential external benefit justifying government investment, we're on very shaky ground. It's a possible market failure, sure, but one reasonably solved privately by sponsorship arrangements and merchandise sales.
Dr Richardson is sceptical of any argument that suggests we are going to get something tangible out of hosting events. “The bottom line is yes, we are going to bring in visitors, and yes, they will spend money. We also know that the taxpayer will pick up a sizeable chunk of what is expected to be a loss of around $40 million.
“To justify this, what becomes more important is what New Zealanders think of the event, and our enjoyment. If anything it is the value of the ‘warm and fuzzies’ and our perceptions and experience of the event that is a more defendable measure of success.”
Dr Richardson, of the School of Economics and Finance at the Manawatu campus, says the benefits associated with participation might be a better rationale for wanting to host the events than purely economic impact.I'm pretty sure the All Blacks would have been in RWC regardless of whether we're shelling out to host. As for FIFA, I hope that we're not going to invest any substantial public funds on the basis that that's the payment necessary to get FIFA to let us play.
“FIFA has selected New Zealand to host the 2015 Under-20 Men’s World Championship. As hosts we get the right to participate, which is huge for us, especially as it is something that can improve the quality of our football.”