Economic impacts of events Essay
Economic Impacts are effects of the level of economic activity in a specific region or area. All large scale and even small scale events are capable of having an impact on the economy we live in, as event managers, we can measure the level of economic impact a specific event is allowing by looking at Direct, Indirect and Induced Impacts. Direct Impacts result from expenditures associated with constructing and operating an event, e.g. Labour, capital, Materials, Supplies etc, whereas Indirect Impacts result from the suppliers of an event purchasing good and services and hiring workers to meet demand levels, these ‘2nd round’ Impacts would not occur if the event in question was to have not taken place. And Finally, we have Induced Impacts which result from employees of the event purchasing goods and services at a household level, at this stage of impact we may also use the Multiplier effect to measure the size of the impact on the economy once additional expenditure is made, giving us the real GDP. The Olympic games held in London in 2012 was a big example of an event which affected the British economy directly, indirectly before, during and after taking place. Before taking place, there were plenty of operating costs which were necessary for the event to take place, supplies had to be bought, tickets were purchased by attendees and so on, thus pumping a large amount of money in to the UK economy as a result of high levels of consumer expenditure. During the games, spending by the visitors to the games improved the economy also, this money being injected back in to the circular cash flow and eventually ending up back in UK households again. From foreign tourists alone, £226, 583m was spent during the games.