Economic Multipliers and Mega-Event Analysis

Critics of economic impact studies that purport to show that mega-events such as the Olympics bring large benefits to the communities “lucky” enough to host them frequently cite the use of inappropriate multipliers as a primary reason why these impact studies overstate the true economic gains to the hosts of these events. This brief paper shows in a numerical example one way in which mega-events may lead to inflated multipliers and exaggerated claims of economic benefits.