Most of the world's governments support their professional sports teams, both through direct monetarily contributions and through numerous sports schools for children. One of the main rationales for that support is that victories in international competitions help the country gain 'prestige'.

But what exactly is the practical benefit of this 'prestige'? Does it help the country grow economically by attracting tourists or investment? Or perhaps it's merely a matter of national 'pride', without any monetary gains?

I'm looking for academic research on this topic or official statements by government institutions.

  • $\begingroup$ This seems to be a very hard issue to prove, because there are many factors involved, making it hard to find a good source of exogenous-enough variation that can justify an empirical analysis like a cross-country study. Additionally, if there is such effect, it might only appear after some span of time, perhaps in the very long term, making it even more difficult to identify empirically. Something more plausible however is to study the economic consequences of hosting a sporting event like an Olympics, or a World Cup. But this is surely not what you want. $\endgroup$
    – luchonacho
    May 15 '17 at 13:15

There is research into this topic but it's not proven.

There's too much variability to consider.

Take the '04 Detroit Pistons (it's a City, I know, but the premise scales). In 2004 the Detroit Pistons were underdogs to the Los Angeles Lakers. Economically, LA was in a much better place than Detroit but Detroit scrapped it's way to a victory (and a return to the finals but a loss the next year to the San Antonio Spurs (Go Spurs Go)). Detroit's victory may have led to sales growth in player's jerseys (Richard Hamilton and Ben Wallace for instance) but the sports victory did not save the city from it's demise and subsequent bankruptcy.

I believe the economic benefits of professional sports victories are more cosmetic than practical. A real estate agent may have a few more selling points in an economic transaction but the gains are usually temporary as it's hard to have back-to-back victories in professional sports...

Controversially, the theory MAY ACTUALLY apply to collegiate sports and the economic prowess of a university. Ever been to University of Georgia or Alabama? Those walls aren't lined with money from their journalism schools, I can tell you that much.

It'd be hard to prove that professional sports wins tie to economic success given how many other exogenous factors there are to economic success but there's data available to analyze this question (specifically, GDP growth and World Cup/Olympic Cup/World Title Events).

I don't know if governments are tossing up grant money for this research though.


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