I highly recommend the book. It is an easy read, and his arguments are compelling. He shows what humans can do when faced with limits. They improvise, innovate, and create amazing things under certain conditions.
Musings about Leadership, Decision Making, and Competitive Strategy
Wednesday, June 17, 2026
Constraints Are Good For Us
I highly recommend the book. It is an easy read, and his arguments are compelling. He shows what humans can do when faced with limits. They improvise, innovate, and create amazing things under certain conditions.
Tuesday, June 09, 2026
Staying Grounded: Find the Right Sounding Board
Thursday, June 04, 2026
Are You Listening to Me? How Can I Tell?
Monday, June 01, 2026
Is Hosting the World Cup an Economic Windfall?
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| CHARLY TRIBALLEAU/AFP via Getty Images |
1. The substitution effect: For the local citizens attending World Cup games, the spending may not be "new" or "incremental" in any real sense. This spending may simply displace other leisure activities. If so, the country's economy does not grow as a result of the locals' spending on World Cup games, apparel, etc.
2. The crowding out effect: The hoopla around the event may cause tourists who may otherwise visit the host country or host cities to avoid traveling to those locations. Matheson cites the example of Orlando, Florida. The city lost tourists who otherwise would have visited area theme parks, but avoided the area because of the soccer fans filling up area hotels, restaurants, and the like. He cites a similar study that found that France did not gain international tourists during the 1998 World Cup.
3. Leakages. Matheson argues that FIFA collects much of the ticket revenue, and most of that money does not remain in the host country. Moreover, most of the increased hotel profits typically do not remain in the local economy.
Matheson concludes that these three effects cause the economic gains often to be far lower than those projected before the event takes place. In fact, he writes, "The results generally show that the observed impact of the World Cup has been a fraction that touted by the event boosters, and frequently the observed impact has actually been negative."
By describing these issues, I don't mean to put a damper on what should be a very exciting event. However, the analysis put forth by Matheson should cause us to examine "economic impact" studies with a very critical eye. That does not just hold for World Cup events. The same type of critical evaluation should be applied to any of these types of studies, whether it be for hosting an Olympics, building a new sports stadium, or constructing a new concert venue.



