Exploring the Economic Impact of Successful Sports and Entertainment Events

What do successful sports and entertainment events require?

Successful sports and entertainment events require an understanding of local economic impacts. Factors like fixed entertainment budgets and competition among entertainment venues play a role in their success or failure. Adjustments in local taxes also affect the entertainment industry's supply-demand balance.

Final answer:

Successful sports and entertainment events require an understanding of local economic impacts. Factors like fixed entertainment budgets and competition among entertainment venues play a role in their success or failure. Adjustments in local taxes also affect the entertainment industry's supply-demand balance.

Explanation:

Successful sports and entertainment events are complex ventures that require careful economic consideration. According to Siegfried and Zimbalist, if people have a fixed entertainment budget, the money spent on professional sports events is not spent on other local entertainment activities. They present the concept that the economic impact of sports on a local economy might not be as beneficial as commonly perceived, due to a lower multiplier effect compared to other entertainment avenues.

Furthermore, resources that market themselves to attract out-of-town tourists might not always be successful in driving economic growth. The example of nightclubs offering bands and making money through food and drink sales shows a direct impact on competing entertainment options, such as movies, by reducing their demand. Additionally, regulatory measures, such as taxes on local entertainment businesses, can influence the supply and demand dynamics of the industry, as illustrated by the increased movie supply following a tax repeal.