Sports Participation Olympic Legacy and Cultural Tourism

Question: 1. Examine critically the relevance of economic theory within sport business markets 2. Employ a range of economic theories and analytical approaches to assist management decision-making within different sports markets and contexts. 3. Interpret and critically evaluate the results of economic investigations within sports business markets. Answer: Introduction Generally, individuals, as well as society, get benefits from sports. It is referred as the most crucial part of the Londons economy which contributes significantly. The contributions come in the form of spending, other economic activities which basically measured by considering Gross Value Added and lastly employment. By sports, the participants get the positive impacts in well-being and health. Sports also bring happiness (DCMS, 2016). In the case of London Olympic 2012 as well as Paralympic games, people get positive energies and wide-ranging positive effects by visualising the games. There are many studies which can assess sports economic benefits. This report will analyse the economic value as well as economic impact in terms of utility and welfare of London sports. Key findings It is known that sports make a lump sum contribution to the individuals lives, to the society as well as to the London economy. From various research, it can be said that the London sports generate the economic value, these are: Firstly, sport related activities had generated GVA of 20.3 billion pounds in 2010. Here, GVA basically helps in measuring each producers contribution or each sectors contribution to Londons economy. GVA is needed to estimate the GDP of London. Thus, the sports of London contributes a major part in the countrys national income. The calculated GVA amount was 1.9% of the total GDP of England. The total revenue generated from sports is greater than the top fifteen industries of London like legal sector, service sector etc. Figure 1: Economic Impact Source: (Sportengland, 2016). Secondly, the sports activities generate a huge amount of job opportunities (Brown et.al., 2013). It was estimated that greater than 400,000 full-time employment opportunities. The calculated percentage is 2.3% of the total job opportunities. Thirdly, playing sports can generate some benefits which involve individual happiness and well-being. Thus, the condition of education and health has improved because it helps to reduce the crime rate among youths and enhance the environmental benefits. It helps in stimulating the regeneration and thus, community development has been taken place to London. The wider benefits to the society can be achieved via the volunteering (Nichols and Ralston, 2011). Lastly, the consumption of the benefits of the sports involves the spectators happiness. When success from sports come in place, it enhances the national pride as well as the feel-good factors among the citizens. In London, the sports economic value in terms of volunteering and health was calculated as 2.7 billion pounds and 11.2 billion pounds respectively in 2011-2012. Figure 2: 2011-2012 estimates Source: (Sportengland, 2016). Sporting Activities From the estimates of 2011-2012, it can be said that 36 percent of the adult citizens that is almost 15.5 million people aged of 16+ participated in sports for once at least in a week for 30 minutes (moderate intensity). Almost 21 million people participated in sports once in a month. More than 6000 organizations of voluntary sports presents in England where 7.6 percent of the total population (3.2 million) gave their contribution in the sports volunteering. Figure 3: Percentage of Adult participation Source: (Sportengland, 2016). According to the reports of 2012, more than 75 million attendances were estimated to involve in the sports events in London. Among these population, 11 million attendances were calculated in Olympic as well as in Paralympic games. 42 million attendance involve in professional football had been accounted. Figure 4: Attendance of Sports Source: (Sportengland, 2016). Expenditure The sports related broadcasting expenditure in London had been calculated nearly about 2.3 billion pounds in 2010. Almost 3.9 billion pounds had been spent on the sports equipment, in sports footwear and clothing, the expenditure had been calculated as 3.8 billion pounds to 28% on footwear and 72 percent on the clothing of sports. In 2010, gambling related to sports were estimated as 4.9 billion pounds. Economic Impact On the basis of the definition of national Accounts of sports, the wider activities of sports like satellite broadcasting or television broadcasting and the sports gambling it can be said that in 2010, the sports of London had produced the Gross Value Added of 20.3 billion pounds. In the analysis part, the further economic model can be perceived to point out the accounting of total economic impacts for the sports participation and the sports consumption. Sports participation includes playing games of sports, sports-related expenditure etc. These were calculated as near about 58 percent of GVA from sports with some consumption related activities like watching sports, sportswear consumption, gambling, and some equipment for recreational utilisation that was responsible for 42 percent. In macroeconomics, GVA plays a key role to enhance the GDP of any country. It can be seen that in London, GVA percentage helps to enhance the GDP. Another factor is an employment opportunity. In terms of job opportunity, sports sector helps a lot. Unemployment is bad for any economy. In London, it can be seen that 440000 full-time jobs were generated by the sports sector. The calculated amount was 2.3 percent of the total employment opportunities in London. Figure 5: GVA contribution (2010) Source: (Sportengland, 2016). It had been accounted that sports participation was 65 percent of the whole sports in relation to the employment and the sports consumption was responsible for 35%. Figure 6: Sports consumption Source: (Sportengland, 2016). Economic value The economic effects of sports in relation with GVA as well as job opportunities are substantial, but all these measures can only capture the sections of economic values. Previously, it is discussed that sports participation can bring the well-being, happiness and reduces the health issues, while the people who love to watch sports, can get the psychological effects and some beneficial effects. In 2012, Olympic Games and Paralympic games were held in London which had brought some wide-ranging and positive impacts. The wider range of benefits of sports to the society as well as individuals can be seen in 2012 and it came from both playing as well as visualising the games. The important benefits are given below. Participation in the benefits of Sports Well-being Firstly, the well-being of individuals and society can be achieved via the sports participation. The DCMS research report has shown the substantial benefits come from the sports participation for which the individual is concerned with respect to the happiness and the well-being. Health Improvement The sports participation assists in the health improvement. The benefits to the society and the individuals from the improvement of health can lead to a healthier society which can reduce the National Health Services costs. The research was undertaken again to value the save costs of the healthcare as well as the total economic value. The total economic value refers to a measure in a broader perspective of the health benefits economic value (Jeppsson and Carlqvist, 2013). Another thing can be discussed that the generation of health benefits have some annual value and it was generated by the sports participation. The estimation of the annual value was 1.7 billion pounds as savings in the costs of the healthcare. 11.2 billion pounds of total economic value was achieved in 2011-2012. Educational Attainment There is an educational attainment improvement of the people who participate in sports. Sports help to enhance the motivation among students. It also can bring improvement in the social relations along with persons and peers in the authorities. It can have a positive effect on time management, self-discipline and the self-esteem. Figure 7: Wider Economic Value Source: (Sportengland, 2016). Reduce Crime rate The sports participation also assists in the reduction of youth crimes and also the anti-social behaviours specifically among the young generations in London. Environment The important effect of sports can be discussed from the viewpoint of environment. Cycling and more walking can be encouraged by sports. Hence, it can reduce the emissions as well as congestion. In this context, it should be remembered that the participants should counterbalance among those. Community Development The projects which are sports related can be used to stimulate regeneration. Thus, the development of community can be achieved. These can be the outcome of the major projects of commercial sports or sports activities in the local community (Tang et.al., 2013). Volunteering The society, as well as individuals of London, can enjoy the benefits via volunteering. The voluntary works consist of broader charitable objectives of the organizations of sports. Not only the society but also the volunteers themselves get the broader benefits after experiencing the charitable works (Fyffe and Wister, 2014). The calculated economic value from the volunteering was 2.7 billion pounds in 2011-2012. It is known that when the GDP of any country increases, the country can achieve growth. However, development is said to be a qualitative approach. When self-esteem, sustainability, discipline, educational attainment are done then the country will be said to be developed (Mankiw, 2013). In the case of London, it can be seen that sports participation not only brings growth but it helps to achieve the development. London Olympics From the above section, it can be seen that the Olympic Games play a key role. The Olympic Games were hosted by London in 2012, 1948 and 1908 (SummerOlympicsNews. 2016). The Olympics of 2012 has been hosted three Olympiads of Games by London. London is the city who had bid greater than once but holding the 100% record. London Olympics of 2012 had promised the engagement of sports by the inspired generation without legacy (Bouka et.al., 2013). Participation The below table will show the year wise participation Table 1: Year-wise participation (male and Female) (DCMS, 2016) It can be said from the table that in 2012 the participation has increased due to the new youth strategy was taken by London sports organizations, enhancing the habit of sports and the legacy of sports in the schools of London (Green, 2012). Based on the table, the column graph can be made. Figure 8: Column graph on Participation in Olympic Games Source: (Author) Funding By pulling the data of ODA and DCMS along with LOCOG, the funding of the Olympic Games can be discussed. The ODA spent 6.248 billion pounds of the public money to get the venues and grounds ready. Another 2.53 billion pounds had spent through local authorities and directly by DCMS. LOCOG had spent 2 billion pounds only. Figure 9: Funding Source: (Rogers, 2012). 1.822Bn were spent in roads, local infrastructure, cleaning up the power lines, site, etc. The costs of the venue were 1.106Bn and 428 had spent for Stadium. The cost of the basketball area was 4m, the security was budgeted as 533m, 296m was included for park transformation. The total funding table will be added in the Appendix. Tourism The Olympics can enhance the revenue of tourism industry of London because people from different regions come to see the games and they stay in different hotels. Apart from this, the participants of Olympic Games stay in 5-star hotels (Prayag et.al., 2013). These can generate revenue from tourism and hence GDP of London has been enhanced. Additional 232m was expected to generate in the restaurant. The customers have spent additional 232m in bars (Stevenson, 2013). Economic leakage Economic leakage refers to the way in which the countrys revenue has been lost to the economy of another country. Leakage was assured in London retail sector. Sector wise leakage can be seen in London because the people were concentrated in some sectors during Olympics (Rose and Spiegel, 2011). Broadcasting In Olympics 2012, the broadcasting was increased via television, internet, satellite etc. The chance of broadcasting was low in 1908 and 1948. Because television and internet service were poor at that time. Conclusion In this report, the effects of sports are discussed. It can be seen that participation in sports help in growth as well development. The Olympic Games of 2012, 1948 and 1908 has been discussed which has shown that participation in sports had increased. The sports participation helps to bring self-esteem and the educational attainment can be done by an individual or the society. 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