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If there is general consensus among researchers that hosting a mega-event can leave a range of material, spatial and symbolic legacies, there is less agreement on the factors determining whether such legacies are of a positive or negative nature, or on their duration. In part this is due to the unique character of these events. They are spatially and temporally highly distinct from other forms of sports consumption (such as participant-driven, amateur or more regular sporting competitions) or other types of spectacles (such as exhibitions) from which economic income may be derived. Wright (2007: 346) aptly distinguishes mega-events from sporting contests organised on a more permanent, albeit smaller, scale by declaring that ‘(e)ssentially, they are based specifically on what is happening as opposed to what is available’. First, mega-events are once-off occurrences, and planning for them has to be tailored to a deliberate point of closure. Second, the time limit placed on not only the hosting, but also activities related to infrastructure development or the design of key sites is often used as rationalisation by event authorities for circumventing statutory procedures or evading consultation with affected communities (Horne and Manzenreiter 2006). That events are essentially ‘owned’ by the sports federations in whose name they are staged lessens the influence event authorities have over central aspects of organising, but can also cause those authorities to take hasty and opaque decisions. Far from yielding to long-term developmental visions, the limited time frames involved in the hosting of a mega-event tend to encourage swift and centralised decision-making that may deviate from long-existing growth programmes in a host city or country (Owen 2002). Fitting event planning into established urban or macroeconomic programmes has been a challenging enterprise for many hosts (see for example Hiller 2000).

Finally, mega-events are in spatial terms relatively fixed occurrences. Although elite-level competitions may be held in different sites across one city or country, such sites are spatially well contained, with mobility in and around the venues highly regulated. As spaces of consumption, and sites where economic activity can be stimulated, competition venues generally involve the limited and controlled circulation of capital extra to that generated by the sponsors and corporations aligned with the proprietor sports federation. The spatially concentrated nature of mega-events can also affect the long-term sustainable prospects of a host area, since positive, but also detrimental, effects can remain geographically focused (Frey, Iraldo and Melis 2007).

Three additional challenges in mega-event legacy appraisal relate to the variety of methodologies that are often used to measure impacts; the lack of agreement among researchers about which forms of investments should be considered part of an event’s costs and which as part of its revenues; and the way in which different economic sectors are differently affected and therefore manifest different legacies.

The variation in the sectoral legacies of mega-events is well illustrated in the case of the tourism sector. It is generally assumed that tourism stands to gain most from the hosting of a sport mega-event. This stems from the nature of the tourism sector itself, which is composed of numerous different industries including industries central to tourism activities, such as (air and overland) transport, accommodation and tour operator sectors, and those which are not central to, but support or are affected by tourism activities, most notably construction, retail and other leisure industries. The compound composition of tourism is generally thought to be an important asset of the tourism sector, since it means that the potential for generating income is heightened and that the effects filter through to all core and related industries – the so-termed multiplier effect of tourism (Mathieson and Wall 1982; Smith 2000). However, numerous commentators have noted that negative effects – such as visitor displacement – can also emanate from the hosting of a major event. An oft-cited example is the 2002 FIFA World Cup hosted by Japan and South Korea, where tourist arrivals declined in the year of the tournament (Horne and Manzenreiter 2004). Indeed, Lee and Taylor (2005) suggest that arrivals to South Korea may have fallen short by more than one-third of pre-event predictions. The 2006 FIFA World Cup held in Germany drew a great number of spectators (3 407 000, outranked in this only by the number of visitors to the 1992 FIFA World Cup in the USA where stadiums were of a larger capacity (FIFA 2006)) but there are some indications that major markets within Germany’s overall tourism economy, such as business tourism, saw a decline during the tournament year (Preuss, Kurscheidt and Schütte 2007: 8).

The potential deflation of established tourism markets during a major sports tournament stems in part from a common failure by event planners or their consultants to adequately profile prospective visitors and to sufficiently tailor tourism development plans towards what amounts to a very specific type of tourist market. Instead, the inclination has been to view sports tourist arrivals to major events as incidental or additional consumers. This is problematic for two reasons. First, it pre-empts a more precise assessment of the tourism impact of a given event. Crompton (2001) notes how the methodological practice to include in event impact studies all tourist visitation during a sports tournament, instead of only that stimulated by the event itself, is a habitual but inaccurate one, leading to routine impact over-estimation. Second, the travel behaviour and consumption patterns of sports tourists are often very different from those of other tourist markets. Such tourists, for whom sport is the primary motivation for travel, may have little interest in making use of other tourist facilities or attractions beyond their own needs (Higham 2005). In the main therefore, while the tourism flow generated by sport megaevents can be substantial, can prompt new infrastructure to arise, and can induce the development of new markets which can be nurtured over the longer term, it can also be offset by its selective nature. Even though events may create net tourism benefits for a host, this often accrues some years after the event was hosted. Few pre-event assessments take this time lag into account (see for instance Cashman 2006).

In terms of assessing the overall economic impacts of sport mega-events, pre-event appraisals used during bid campaigns often wittingly or unwittingly overestimate a given event’s potential economic consequences. This is often the case where bid campaigners have an interest in highlighting an event’s benefits above possible costs, and is often caused by the methodologies used: economic multipliers tend to be inflated; gross economic output is wrongly equated with event impacts; and the legacy footprint of an event is projected to extend over an implausibly large geographical area (Crompton 1995; Matheson 2008). Often too, pre-event impact studies either underplay or miscalculate the costs associated with the hosting of an event, commonly neglecting to include aspects such as expenses incurred from the start of bid processes (Gibson 1998). Many other hidden costs may surface during an event itself, or in its immediate aftermath, leading to significant mismatches between ex ante projections and ex post assessments. Frequently, the reason is that public authorities regard capital investments on infrastructure as a benefit and not a cost. While it is the case that newly constructed roads and upgraded transport systems can help bolster wider economic production, it is often not understood that these infrastructural developments represent capital deviated from other projects, or increases in government borrowing which in the absence of the mega-event would not have been incurred. More thorough assessments of event expenditures should therefore try to calculate the implications of such opportunity costs for the macroeconomy, the consequences of the possible reduction of tax bases, and the costs that servicing an event place on local economies.

Ideally, the effects, benefits and costs of events should be assessed during four phases: the bid preparation and process period (which in the case of the Olympics and the FIFA finals could range between two and four years); the five- to seven-year period during which preparations towards the event take place; the short period (two to four weeks) during which the event is held; and the more extensive post-event period. Preuss (2004) suggests that in the case of the Olympic Games secondary legacies are influenced by the scale and extent of pre-event infrastructure investments: where the period of investment is longer, the period of impact is extended, in Preuss’s assessment for up to eighteen years. Even so, the condition of the wider national economy can promote or brake positive stimulatory impacts on the host economy. Preuss provocatively contends that a prolonged period of impact could also have negative repercussions for a host city and the national economy, in the case of rapidly expanding economies contributing to rising property prices in the long run.

Mega-events have also been associated with other negative social and environmental legacies (Waitt 2003) including forced evictions, particularly of poorer, inner-city residents in some North American cities, the redirection of public funds from programmes such as housing delivery, and the over-securitisation of host cities (see for example CORHE 2007; Lenskyj 2008).

In all, it is a serious indictment of sport mega-events that most credible ex post and longitudinal studies show that their effects on employment and wages are limited and of a temporary nature, and that they are of negligible consequence for hosts’ macroeconomies (see for example Allmers and Maennig 2008; Baade and Matheson 2004; Preuss 2004; Szymanski 2002). Indeed, many economists consider sport mega-events poor stimulants to economic development (see Coates and Humphreys 2002; Porter 1999). At worst, an event could leave long-term deficits and public debt from which hosts could only emerge several years after the event has come to an end (the most notorious example is the 1976 Olympic Games, which left the authorities of Montreal with a debt which they only managed to repay thirty years later). Possibly one of the strongest predictors of how a host could be affected in the future relates to the set of governance relationships that exists there, and the management structures that are set up to stage an event. In this regard Poynter (2006) notes that in those cases where greatest positive legacy has been achieved – such as Barcelona from its hosting of the 1996 Summer Games – the city bid ‘related to an existing urban development plan’ (Poynter 2006). Greatest success therefore stems from using events to fit into previously developed programmes, and not ‘retrofitting’ programmes into event objectives.