MMA and Boxing both call Las Vegas the capital of their respective sports. To analyze the economic impact these sports have on the world we will look at recent fights in Las Vegas by boxing superstar Manny Paquiao and MMA superstar Anderson Silva and how those fights and future fights affect the economy. On fight weekends, that impact extends from an uptick in gambling to an increase in everything from hotel rates to the price of bottle service at local nightclubs. [1] In a city that lacks even one franchise in any of the major professional sports leagues, tourism is driven by events, few bigger than a championship prizefight. In fact, a bout like Pacquiao’s against Juan Manuel Marquez at the MGM Grand on Saturday will earn the Nevada Athletic Commission its budget for the year. And that is but one small slice.[2] Todd DuBoef, president of Top Rank Boxing, chewed over a chopped salad and Pacquiao’s economic boost in a typical fight week. Asked if that impact reached $100 million, he scoffed. “No,” he said. “It’s way more. Not $100 million. Hundreds of millions.” [3] “It’s hard to put a specific number on it,” said Josh Swissman, vice president for corporate marketing at MGM Resorts International. “But it’s a marked increase. A fight weekend like this is like New Year’s Eve for us. And New Year’s Eve is the biggest night in the whole city.” [4]
Keith Kizer, executive director of the Nevada Athletic Commission said the buzz surrounding fight weeks has come later in recent years, starting a week before, not three. Yet this fight sold out two weeks after tickets hit the market, for a projected $11.8 million in gross sales, which would rank ninth for all fights. [5]
The commission, Kizer said, receives 6 percent of the gate, in addition to a $50,000 fee, good for $758,000, based on the projection. “One fight,” Kizer added, “basically covers our entire budget.” [6] The impact boxing has on Las Vegas and other places around the world has been tremendous and will continue to help boost recovering economy’s like Las Vegas.
“The economic impact for Las Vegas, we don’t have all the numbers yet, but it’s somewhere between $93 and $140 million on a week where this town would have been dead,” said UFC President Dana White regarding UFC 148 this past July. [7] UFC fight week which includes UFC 175 and the TUF 19 finale, Dana White recently said he expects the UFC to generate roughly $175 million in revenue for Las Vegas. That is a tremendous boost to a local economy in these difficult times. The UFC introduced an economic impact study which indicated that two UFC events in New York in the first year of regulation would garner the state $23 million dollars. [8] The study found that holding two UFC events in the state (one at Madison Square Garden and one in Buffalo) will create roughly $16 million in new spending. Additionally, the study found smaller MMA operators will likely hold events that would bring an additional $4 million. In total, $23 million of annual new spending and hundreds of new jobs will be created in the local economy by regulating MMA. Many UFC fans travel from surrounding states, stay for extended periods (at least one night at a hotel), and often arrive hours early for fights, which boosts merchandise and concession sales. New York-based MMA gyms and related industries are also expected to see an increase in revenue from the regulation of the sport. Likewise, local businesses will benefit greatly from MMA bouts, particularly outside of New York City where the economic influx is proportionally greater. This trend follows that of surrounding states which currently regulate MMA fights.[9] The Pennsylvania State Athletic Commission expects the Aug. 6 Ultimate Fighting Championship event at the Wells Fargo Center to generate between $4 million and $5 million in regional and state economic benefits. [10] Both boxing and MMA bring a huge boost to the economy of local markets when fights take place, and with the UFC holding 32 fights in 2013 throughout the entire world, they are sure to boost the economy of the United States, Brazil, Australia, Asia, and Europe. Combat sports have an enormous impact on the global economy, in going through the financial difficulties the world is in right now, these fights help generate money and jobs.
[1] Greg Bishop, Paquiao Packs An Economic Impact in Las Vegas, NY Times, (Mar. 26, 2013 3:12 PM) http://www.nytimes.com/2011/11/11/sports/pacquiao-packs-an-economic-punch-in-las-vegas.html?pagewanted=all&_r=0.
[2] NY Times, supra
[3] NY Times, supra.
[4] NY Times, supra.
[5] NY Times, supra.
[6] NY Times, supra.
[7] Mathew Roth, Economic Impact was 93-140 Million for Las Vegas, Bleacher Report (Mar. 26, 2013, 4:28 PM) http://bleacherreport.com/articles/1250864-ufc-148-results-dana-white-economic-impact-was-93-140-million-for-las-vegas.
[8] Jason Cruz, UFC Introduces Economic Impact Study on Behalf of Legalization in NY, mmapayout, (Mar. 26, 2013 4:34 PM) http://mmapayout.com/2011/01/ufc-introduces-economic-impact-study-on-behalf-of-legalization-in-ny/.
[9] Mmapayout, supra.
[10] Mmapayout, supra.