An economic impact analysis of the Comrades Marathon on the city of Durban.
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Sport has become a major industry as well as a key cultural preoccupation in contemporary society. Cities are increasingly using major sporting events and activities to re-image themselves, promote urban development and fund economic growth and regeneration. Major sport events are often recognised for their ability to generate significant economic benefits for the host destination. The major difference between this study and other economic impact studies is that the event is tracked over a two-year period. This afforded the author the opportunity to compare and note the variations in the data over the two years. Initially, the study purports to analyse the economic impact of the Comrades Marathon on the City of Durban. A secondary objective is to demonstrate the value of such a major sporting event to the regional and provincial governments as well as the formal and informal businesses in the city. Durban like other key cities in the world is and will increasingly be confronted by two main and related challenges. Firstly, there is need to successfully compete in a universal economy characterised by increased competition and globalization. Secondly, there is need to eliminate poverty and address issues of inequality and marginalization. Thus, the Comrades Marathon, as a major sporting event, can be seen as a primary driver to create jobs and contribute to competitiveness. As stated the research was conducted over two years viz. 2004 and 2005 thus representing an "up" and a "down" run. The questionnaire method and interviews were employed for this study and were administered to accommodate the alternate runs. The questionnaire requested data on the age, gender, occupations, income levels, spending patterns and the types of activities that the population found attractive. The population consisted of foreign runners and supporters, runners and supporters that reside in other provinces of South Africa, stall holders at the Comrades Expo that is normally held over three days prior to the race, representatives of the sponsors of the event and vendors. The sample was selected randomly from the population. Face-to-face interviews were conducted with representatives from the hotel industry in Durban, the Acting-Chief Executive Officer and committee members of the Comrades Marathon Association and the Marketing Managers/Public Relations Officers of three major shopping malls located in Durban. Turco, Swart, Bob and Moodley (2003) reported that the leverage ratio that is public sector input against private sector response indicated that the 2001 Comrades Marathon together with other major sporting events held in the city were successful and contributed significantly to the Durban economy. The leverage ratio is illustrative of the amount of money that was accrued to the private sector with every Rand spend by the public sector. Consideration was given to the total revenue generated by peoples' average spending at the events and the total amount accruing to the accommodation industry. Cognisance must be taken that the leverage ratio does not consider overall spending in Durban as well as other general multipliers such as revenue generated from transport, other financial transactions, product suppliers, guided tours, established businesses and informal traders. The findings showed that the leverage ratio for 2004 was computed to be 1:216.38 that is for every Rand spent by the public sector on the event R216.38 was generated by the private sector. In addition, the leverage ratio for 2005 was computed to be 1:434.49 that is for every Rand spend by the public sector on the event R434.49 was generated by the private sector. Thus, the expenditure was considerably higher in 2005 with an upsurge of R31 819 272 that is an increase of 33%. The fundamental idea behind the economic impact of sporting events is that it injects a significant increase in the demand of goods and services into the economy. This effect is not simply the direct effect of consumer spending but also the indirect effects caused by the stimulus to the economic activities induced by the direct effects.