Sectoral labour market effects of the 2006 FIFA World Cup

Using the case of the 2006 FIFA World Cup, this study is the first to test the employment effects of a mega-sporting event on the basis of data that are both regional and sectoral. It is also the first study of sporting events to use a non-parametric test method. Earlier studies on the World Cup could not identify any employment effects. In contrast, we find a small but significant positive em-ployment effect on the hospitality sector and a negative effect on the construction sector. To our knowledge, this is the first time that such a crowding-out effect of public investment on the occasion of a mega-sporting event has been found in an empirical analysis.