The Economic Impact of Olympic Games : Evidence from Stock Markets


Dick, Christian D. ; Wang, Qingwei


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URL: http://ub-madoc.bib.uni-mannheim.de/2092
URN: urn:nbn:de:bsz:180-madoc-20925
Document Type: Working paper
Year of publication: 2008
Publication language: English
Institution: Sonstige Einrichtungen > ZEW - Leibniz-Zentrum für Europäische Wirtschaftsforschung
MADOC publication series: Veröffentlichungen des ZEW (Leibniz-Zentrum für Europäische Wirtschaftsforschung) > ZEW Discussion Papers
Subject: 330 Economics
Classification: JEL: G14 L83 ,
Subject headings (SWD): Olympische Spiele , Wirtschaft , Einfluss , Börsenhandel
Keywords (English): Olympic Games , economic impact , event study , stock markets
Abstract: By means of an event study of stock market reactions to the announcement of the Olympic Games host cities, we find a significant and positive announcement effect of hosting the Summer Games, with a cumulative abnormal return of about 2% within a few days. We do not find any significant results for the Winter Games. Neither do we detect a significant impact when bidders lose the competition. Our results differ from those of a similar study by Mirman and Sharma (2008), who find that the Winter Games are subject to a significantly negative announcement impact, while the Summer Games are not. Our results, however, rely on a larger sample of 15 Olympic events and are obtained by assessing the abnormal returns after the announcement against a “business–as–usual" situation (instead of testing the difference between winner group and loser group). Our findings are in line with economic intuition, since the Summer Games represent a larger event and are thus more likely to have a significant impact. We also find that among the winners, small economies tend to have greater cumulative abnormal returns than their large peers.
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Dick, Christian D. ; Wang, Qingwei (2008) The Economic Impact of Olympic Games : Evidence from Stock Markets. Open Access [Working paper]
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