The economic impact of the Olympic Games: evidence from stock markets
Christian Dick and
Applied Economics Letters, 2010, vol. 17, issue 9, 861-864
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. Yet, we find no significant results for the Winter Games and for losers. Our results differ from those of Mirman and Sharma (2008), who found that the Winter Games have a significantly negative announcement impact, whereas there is no effect for the Summer Games. Our results 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 winners and losers). Our findings are in line with economic intuition: the Summer Games represent a larger event and are thus more likely to make a significant impact. We also find that among the winners, small economies tend to exhibit greater cumulative abnormal returns than their larger peers.
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Working Paper: The Economic Impact of Olympic Games: Evidence from Stock Markets (2008)
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