How Sport Events Contribute to the Economy of the Hosting Country (FIFA World Cup 2021)

Introduction

To begin with, sports and sports events have become an essential and integral part of contemporary culture and people’s pastime. Furthermore, sport-related professions are becoming more and more demanded. Except for the interesting leisure time, people can spend watching and playing sports games. Moreover, many popular sports perform a function of the financial compound for a country’s economy.

Currently, sports events play a role in business. In other words, the industry of sports games attracts much money and, as a consequence, it results in income for the hosting country. One of the events characterized by big amounts of money circulating within a hosting country is the FIFA World Cup. Football has a long time ago become a game that attracts millions of fans and supporters, who spend much money to watch the games (especially, those of great importance for the history of the game). Additionally, a significant share attracted by FIFA is brought by gambling. The last one is frequently supposed to be a vital tool for earning money during football matches.

As a consequence, in accordance with the most recent research, FIFA enriches the economy of a hosting country manifold. Thus, the purpose of this literature review consists in finding out how sports events such as the FIFA World Cup 2021 will contribute to the economic development of the hosting country. To achieve this aim, it is necessary, first and foremost, to define the term ‘literature review.’ Hence, the literature review is one of the numerous parts and methods of investigation whose essential goal is to research the data on a specific topic in order to define the history of development of an object or process; to overview the present state of affairs in the chosen topic, and to provide the analysis and evaluation of the key directions that contribute to the development of an object

It is also necessary to mention that the sources used in the present literature review are the journal articles and books focusing on the economic compound of sports in general and football, in particular. The material chosen for the analysis is represented by the recent researches in the field and provides the experiments and theoretical basis for the investigation.

Literature Review

To start with, regarding football games as an essential means of enriching the economy, first and foremost, many scholars claim that FIFA as the most important institution in this kind of sport is a source of constant income. As a consequence, Gratton , Dobson, & Shibli (2010) are convinced that a hosting country, before being chosen, is studied in accordance with the effects, which “are primarily justified in economic terms, by estimating the additional expenditure generated in the local economy as the result of the event, in terms of the benefits” and which are generally acknowledged to be “injected from tourism-related activity and the subsequent re-imaging of the city following the success of the event” (Gratton, Dobson, & Shibli, 2010, p. 19). In other words, the development of tourism contributes to the interest in visiting the major sports events. This aspect, in its turn, contributes to the development of the economic structure of the sports events that consequently enrich the hosting country’s local budget. This assumption has to be regarded more precisely by the governments, and their task has to consist in developing and simplifying the touristic routes – at least in times of the biggest sports event such as Olympic Games or World Cup.

It is important to make an emphasis on the fact that the same idea is supported by Sterken (2006), who believes that the hosting country’s GDP per capita rate rises to a great extent while major sports events. One of them is the FIFA World Cup. In addition to this, the author states that the timing of the sports event is closely connected to the amount of money earned during sports games. Finally, the author, similarly to Gratton, Dobson, & Shibli (2010) has a conviction that economic rise of the hosting country is generally dictated by the number of fans arrived at the event and by the bids and gambling.

Gambling has to be taken into account by the government to take over the legality of the gambling process to sustain and provide the mandatory paying taxes. This assumption is obvious in the research conducted by Scharfenort (2012), using Qatar as an example. The author thinks that the so-called knowledge-based economic approach is called to support the sports events and the culture of legal gambling. Only in the condition of understanding the necessity to take part in legal gambling in sports, the hosting country will have a chance to prosper, as well as FIFA institution will have a chance to keep on its activity.

Oppositely to the mentioned above points of view, Baos & Rodriguez (2013) believe that the essential way to enrich the hosting country’s economy in the World Cup 2021 is the quality of services provided. This idea is determined, on the one hand, by the assumption that services are easier to be controlled; on the other hand, it will permit the hosting country to rise “employment, investment in stadiums and infrastructures, accommodation and meals, transport and the entertainment and leisure activities that accompany the event” (Ba?os & Rodr?guez, 2013, p. 203).

Analyzing this approach, it is possible to come up with the conclusion that the service sphere is one of the most important during such events as the World Cup. Thus, it is vitally important to create such a system that would control the quality of the services provided as well as research the new and unexpected ways of entertainment. This challenge has to be met by the management of the events and the ministries of culture and sports.

The idea of consolidating various institutions is strongly supported by Preuss (2012), who has a conviction that “the technical requirements change dramatically every four years” (Preuss, 2012, p. 22), and it is incredibly important to be up-to-date to provide a versatile structure or scheme of the sporting event’s running. To include various approaches (such as management, economics, politics, etc.) to the event and provide its successful organization, it is necessary to state clear aims. These aims would, on the one hand, contribute to the development of the country’s culture; on the other hand, would permit financial income and economic benefits for the hosting country; and, finally, establish the way for the innovations in the sphere of sports events.

Chappelet & Parent (2015) regard the sports events’ role as finance-based. Observing FIFA World Cup 2021, the authors single out several aims that have to be followed to make the FIFA events successful. One of the aims consists in establishing sporting characteristics, which mean the satisfaction of various viewers’ needs (this may comprise of leisure activities, accommodations, and different sports performed). The second objective to be followed is the financial compound: it presupposes the creation of the financial plan, which includes possible expenses and incomes as well additional incomes from applying extra services (accommodation of VIP class, exotic ways of entertainment, etc.). In other words, these are the commodities that are not accessible for an ordinary viewer, however, needed by the rich people. The third goal presupposes the amount of money expected to be won via gambling and bidding.

Analyzing such an approach means that, in comparison to the former FIFA World Cups, the next one has to differ in a number of aspects to attract as many people as possible since they are the main source of income. Additionally, regarding the scandals connected with FIFA presidents, it is necessary to minimize the negative impression of the organization in order to rebuild the trust and interest in the event.

Andreff & Szymanski (2006), Dobson & Goddard (2011), and Morris (2011) believe that to make the World Cup 2021 function in a proper way, it is necessary to work out the strategies that would contribute to the economic growth of the hosting country, which is the most responsible for the success of the event. Similarly to Chappelet & Parent (2015), the authors think that any major sport event has to be a tool for earning money and establishing international links and relations. Hence, as a consequence, the authors claim that the year 2021 is not as far as it may seem, and it is important to forecast the tendencies and trends that will certainly take place. These tendencies and trends have to be applied to all the aspects mentioned by Chappelet & Parent (2015). Otherwise, the FIFA institution and football events such as the World Cup will lose their authority and viewers’ support forever.

Oppositely to Andreff & Szymanski (2006), Dobson & Goddard (2011), Morris (2011), Brannagan & Giulianotti (2014), and Brannagan & Brix (2014) trace back the history of FIFA and World Cup and conclude that the format FIFA uses is old-fashioned. People have significantly, and they need modernized approaches to the organization of such events. Brannagan & Giulianotti (2014) and Brannagan & Brix (2014) make emphasize the fact that it is necessary to promote new teams that are not as popular as those who usually take part in the World Cup. It will provide a sense of competitiveness and provoke more interest in the event. This will, in its turn, contribute to the economic growth of the hosting country.

In accordance with the hypothetical calculations conducted by Brannagan & Giulianotti (2014) and Brannagan & Brix (2014), the World Cup, which is expected to be held in 2021, will earn more than the threefold amount of money. These results are outstanding. Thus, FIFA under the hosting country’s government’s control has to change the policies inside the organization and contribute to the new, unexpected format appearance.

Gillentine & Crow (2005) have a conviction that, in accordance with the financial results of the former World Cups, there is an urgent necessity to change the tools of organizing the event. Similar to Chappelet & Parent (2015), the idea of authority and respect toward FIFA has to be reviewed. Foreseeing the possible scandals, such as those caused by its president, Gillentine & Crow (2005) propose to change the inner policy of the institution to contribute to change policy implementation. The sociologists have counted that the respect and support that FIFA had enjoyed before and the present state of affairs are oppositely different. This fact has a negative impact on football games and, as a consequence, on the economic development of the hosting country.

This strategy of support and restoration has to be an active process, which has to be started nowadays. Otherwise, the interest in the World Cup will fall manifold due to the scandals, rumors, and bribery existing within the organization. The measures have to be taken by the governments to be certainly sure in the successful results.

To sum up, the paper has investigated several approaches to the question of how the hosting country can benefit from the FIFA World Cup 2021. Having regarded the key strategies, it is possible to claim that it is necessary for FIFA to change the approach and format of the World Cup as well as regain the credibility they have lost in order to succeed in organizing the next World Cup. Otherwise, the campaign will fail, and the hosting country will not raise the expected profits. The essential responsibilities should be taken by the governments and FIFA administration.

Such aids as media promotion have to start nowadays to develop a brand new sports event based on the best traditions of the World Cup Championships of the past. Such measures, in accordance with the numerous studies, have to comprise of changing and improving the leisure activities, accommodation conditions and implementing new formats of the games. Gambling, which is known to play a vital role in the championships, has to be controlled by the state authorities and exclude any signs of corruption. Furthermore, the ideas and research considered in the paper can serve as a strong basis for the new policy implementation since they are all characterized by the calculations and valid and valuable strategies. Finally, the World Cup 2021 has to be a new point in the football history, and it has to be different from the past experiences to be able to attract as many spectators as possible and regain the lost interest in the FIFA organization, as well as the in the game itself.