Thabo J. Gopane and Reggy M. Mmotla

This paper investigates the domestic stock market reaction to the announcement of South Africa winning the bid to host the 1995 Rugby World Cup, 2003 Cricket World Cup, and 2010 FIFA World Cup as well as Morocco concurrently losing the hosting competition for the 2010 FIFA World Cup. We used Event Study and EGARCH models. For Event Study, we evaluated normal market performance using 250 daily stock returns, while abnormal returns were tested within a 41-day (-20, +20) event window. The test was replicated using 2,227 daily compounded stock returns for the EGARCH model. Based on both the...Read more

Bryan Engelhardt
Victor Matheson
Alex Yen
and Maxwell Chisolm

Roughly seven years before an Olympic Games, the International Olympic Committee (IOC) accepts bids from countries to host an Olympics. Subsequently, the IOC deter-mines and announces to the world who has won (and lost) the right to host. Contrary to prior evidence, we find the announcements do not affect the bidding countries’ stock markets. We complement prior studies by including additional, more recent, years of announcements, by investigating whether there are effects prior to the announcement, and by testing for an effect both parametrically and nonparametrically.

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