Thursday 15 September 2011

Rugby Benefits

The latest Rugby World Cup benefit estimates has this gem:
If New Zealand is able to capitalise on their hosting of RWC 2011 to attract more events, as well as developing its reputation as a destination for sports tourism, combined with continued development of domestic involvement in sport related activities, the longer term impacts could be:

Consumer expenditure in the New Zealand sport economy by the end of the decade:
     US$1 billion (NZ$1.2 billion)
Sport-related economic activity in the New Zealand sport economy by the end of the decade:
     US$11.7 billion (NZ$14 billion)
Number of people working in sport-related occupations in New Zealand by the end of the decade:
     Between 52,000 and 58,00
You sure can pack a lot into conditional statements. If we make a whole pile of other investments of unquantified cost, the long-term benefits of the Rugby World Cup (ignoring the costs of those ancillary investments) could be huge!

The big numbers have been getting a fair bit of press. Note that they're aggregated over a decade with no hint about whether any kind of time discounting's been used. Maybe that's the expected horizon of effects, or maybe it's just a convenient period for getting a big number. And never mind that "economic activity" doesn't have any particular connection with benefits: you have to net costs from measures of international visitor spending to get the activity's benefits.

They say international visitors, net of substitution and time switching, will provide consumer spending of $411 million that would not otherwise have taken place. But again, that's not net of the cost of providing services. And, if it includes visitor spending on tickets, the only way it counts as a benefit is by defraying the costs of hosting the thing; in the absence of the RWC, that portion of spending would disappear but so too would a not unreasonable quantum of cost.


  1. You have to love those numbers contained in Table 2! Source: Centre for the International Business of Sport; do they mean the people that are writing the report? It is almost funny in its circularity.

    There is no hint of methodology and then, there is the list of references at the end of the report, most of which are never referred to in the text.

  2. Reminds me of this TV satire.

  3. Wow. I've never seen that before. Thanks!!!!

  4. V: Not as good as Yes Minister, but a nice Aussie update of same? Reasonable synopsis?

  5. Yes not quite Yes Minister, but as it screened when Rudd was PM, it was almost current affairs.