World Cup host cities invest in infrastructure, services, and more. Does the investment pay off?
© VANDERLEI ALMEIDA—AFP/Getty Images
The FIFA World Cup is the world’s premier international men’s football (soccer) tournament. Held every four years and watched by audiences around the globe, the World Cup is much more than a championship. It’s also a temporary economy.
For a month, host cities become stages for one of the largest sports spectacles in the world. Hotels, restaurants, transit systems, security services, advertisers, media, local businesses—all are pulled into the tournament’s orbit. This brief, yet potent burst of economic activity can significantly transform, accelerate, or strain local economies.
Although the World Cup is often viewed as a profit machine, it’s not a single economic engine. It’s made up of two closely linked yet distinct parts: FIFA’s global revenue system and a host city’s regional economy.
Even when the two are closely coordinated, their outcomes can differ sharply. FIFA may generate a more direct stream of revenue from ticket sales, broadcasting rights, sponsorships, and licensing. But the host city often experiences a more complicated mix of visitor and tourism revenue, public costs, infrastructure pressures, and post-tournament challenges.
All the world (cup) is a stage
World Cup matches take place within stadiums, but the tournament’s economic and experiential reach extends far beyond the arena. The surge in international visitors, global media attention, and commercial activity turns the host city into part of the event.
Brazil fans cheer their side during a match against Sweden at the 1994 FIFA World Cup.
© Beate Mueller—Bongarts/Getty Images
After years of logistical preparation behind the scenes, the city’s transformation becomes visible almost immediately as the event commences.
- Hotel rates rise due to a surge in demand.
- Traffic flow in designated streets is reorganized to accommodate the influx of vehicles and pedestrian activity.
- Staffing is expanded for police, security, and other emergency response units.
Also, stadiums, whether publicly or privately owned, often require modifications to host matches and to comply with FIFA’s “clean site” regulations, which aim to guarantee exclusivity for official sponsors by removing unauthorized branding and commercial advertisements.
The Infantino model—bigger revenues, bigger redistribution
Under FIFA president Gianni Infantino, FIFA justifies its commercial growth by emphasizing how World Cup revenues help fund the development of the sport worldwide. Its FIFA Forward Development Programme accomplishes this mission by redistributing revenue to national member associations for operations, infrastructure, and competitions supporting the development and expansion of the sport. For instance, during the 2023–26 cycle, FIFA Forward 3.0 provided up to $8 million per member association.
But the program also plays a role in FIFA’s political economy. While FIFA argues that it reinvests its profits to support the game on a global and distributed scale, some critics note that the same member associations receiving funding also vote in FIFA elections—a dynamic that’s legal, but not without complications.
Who really benefits from (and who pays for) the World Cup?
The World Cup’s economic effects travel across a vast global chain—from stadium concessions to hotel bookings, sponsorships, and licensing deals. But its regional impact is uneven, and doesn’t usually end after the last transaction. It comes with externalities, positive or negative, whose consequences can linger long after the event. And in this particular economic dynamic—one that runs on two very different ledgers—those effects can fall unevenly.
The upside and downside for FIFA
FIFA’s business model allows it to monetize the same event across vast markets and multiple commercial channels. It can generate revenue by selling media rights to broadcasters, sponsorship rights to brands across the globe, tickets to fans, hospitality and VIP packages to corporations and wealthy attendees, and licensing agreements to merchandising partners.
For example, during FIFA’s 2019–22 cycle, culminating in the 2022 World Cup held in Qatar, FIFA’s revenue reached a record $7.57 billion.
| Revenue category | Revenue amount | Approximate share |
|---|---|---|
| Source: FIFA | ||
| Television and broadcasting rights | $3.426 billion | 45.3% |
| Marketing rights; sponsorships | $1.795 billion | 23.7% |
| Ticket sales and hospitality | $949 million | 12.5% |
| Licensing | $769 million | 10.2% |
| Other revenue | $629 million | 8.3% |
| Total revenue and other income | $7.568 billion | 100% |
FIFA’s monetary benefits have historically outweighed its risks, but its potential downsides are not purely financial. They often appear as ethical, political, reputational, or commercial challenges. For instance:
- The 2015 FIFA corruption scandal led to the U.S. Department of Justice indictment of nine FIFA officials and five corporate executives on racketeering conspiracy and other charges.
- The 2022 Qatar World Cup prompted accusations of sportswashing, as critics claimed the tournament deflected scrutiny from human rights concerns. Qatar lacked existing World Cup–class infrastructure. But it had enough capital to bid aggressively and spend an estimated $220 billion to host the event, making it the most expensive World Cup in history. Qatar viewed this as an investment in the country’s reputation, which, as critics claimed, diverted attention away from its controversial policies regarding human rights, namely, its restriction on LGBTQ+ rights and its allegedly poor treatment of migrant workers.
- The use of dynamic ticket pricing for the 2026 World Cup sparked fan criticism over ticket affordability and pricing transparency.
Meanwhile, host cities often bear the tournament’s most visible costs and potential disruptions.
FIFA’s commercial success didn’t only attract sponsors, broadcasters, and host cities, all of whom were eager to benefit from the spectacle. It also attracted a few who were willing to circumvent legal means to monetize that success.
In May 2015, the U.S. Department of Justice unsealed a 47-count indictment charging nine FIFA officials and five corporate executives with racketeering conspiracy, wire fraud, and money laundering. The involved parties allegedly abused their positions to enrich themselves. Specifically, prosecutors alleged that:
- Media and marketing rights were sold in a corrupt manner. FIFA officials awarded broadcasting and sponsorship contracts not to the most qualified bidder, but to marketing companies that agreed to pay them personally on the side.
- Executives took bribes disguised as commissions. Personal kickbacks in exchange for contracts were structured to look like legitimate business fees.
- There was a two-decade operation. The DOJ described a 24-year scheme that spanned at least two generations of officials, indicating the corruption was institutional.
- Proceeds were laundered. To conceal their origin, these illicit payments were moved through shell companies, offshore accounts, and intermediaries.
The sale of media and marketing rights was the mechanism that made FIFA’s operation so profitable. Between 1991 and 2015, sports marketing executives allegedly paid well over $150 million in bribes and kickbacks to secure these contracts. According to FIFA’s own figures that were cited in the indictment, around 70% of its $5.7 billion in total revenues between 2011 and 2014 came from selling TV and marketing rights to the 2014 World Cup. The rights were legitimate products. But the corruption took place in the way they were sold.
The legal fallout lasted nearly a decade. It resulted in dozens of guilty pleas and convictions, although some sentences were appealed and complicated by differing legal interpretations of U.S. wire fraud law. FIFA introduced governance reforms in 2016. However, the institutional mechanisms that made the scandal possible—namely, centralized power and opaque commercial negotiations—left an open question as to whether the reforms were deep enough to enforce accountability.
The International Sport and Leisure (ISL) affair, another scandal predating the 2015 indictments by over a decade, pointed to the same structural problem. FIFA’s former president João Havelange, his son-in-law Ricardo Teixeira, and other executives received payments characterized as bribes from ISL, a sports marketing firm, in exchange for broadcasting and marketing contracts. While neither Havelange nor Texeira faced criminal conviction, and both stepped down from their roles (in 2013 and 2012 respectively), the affair established a pattern of corruption that made the FIFAgate scandal less of a surprise and more of a warning about FIFA’s institutional accountability.
The upside and downside for host cities
The economic benefits host cities experience are spread across many businesses. Hotels, bars, restaurants, and other vendors see a boost in traffic and potential sales. Cities get a monetary lift from local tax receipts. Infrastructure upgrades, tourism exposure, and global visibility can boost a city’s reputation and its civic pride.
One of the most transformative examples was the 1994 U.S. World Cup, which drew more than 3.5 million spectators, averaging nearly 69,000 fans per match. With more than 50 matches held in nine host cities, the tournament not only demonstrated that the United States could host soccer on a global scale, but also helped raise the sport’s cultural profile across the country.
Its clear advantage, however, was that it relied on existing stadiums, which reduced the risk of post-tournament underutilization. The tournament’s biggest legacy was arguably that it led to the launch of Major League Soccer in 1996, laying the groundwork for professional soccer’s long-term infrastructure as a new market in the U.S. It also generated a financial surplus that helped seed the U.S. Soccer Foundation.
But economists have argued that the economic gains for host cities were often overstated. The 1994 World Cup was not necessarily a case of event-driven local wealth creation. Despite the tournament’s successes, some researchers have argued that the economic benefits accruing to host cities were modest relative to the costs they incurred. For example, in a widely cited study, economists Robert Baade (Lake Forest College) and Victor Matheson (College of the Holy Cross) estimated that the tournament’s economic impact fell between $5.5 billion and $9.3 billion short of pre-tournament projections.
This makes the 1994 World Cup a more nuanced kind of success story: one that created a new sports market and potential economic engine on a national scale, while leaving open questions about the economic returns realized by individual host cities.
Any potential benefits, sustained or short-lived, come at a steep price, as World Cup events are often exceedingly expensive to host. And in many cases, a city’s financial gains—a mere fraction of FIFA’s—can result in a breakeven scenario or a loss.
Moreover, a host city often has to start spending long before it knows whether a payoff will materialize. Up-front costs can include stadium modifications, expanded sanitation services, private security, police overtime, transit support, public communications, crowd control measures, street closures, and emergency planning.
The resulting benefits arrive later, indirectly, or not at all. Business risks remain. Hotels may not fill as expected. Some local businesses may not benefit, due to reduced public access. Residents face congestion, price increases, and general disruption. While FIFA receives the majority of the financial benefits, local governments pay the majority of the operating costs. And such costs may extend well beyond the scope and duration of the tournament.
Brazil 2014: A cautionary tale
Brazil’s 2014 World Cup is a compelling cautionary tale of how a tournament can succeed as a spectacle while failing as a public investment. The massive construction efforts undertaken in preparation for the World Cup were highly controversial from the start, as local governments oversaw projects resulting in the widespread displacement of residents. But the deeper problem was Brazil’s decision to host two major global events—the World Cup and the Summer Olympics in Rio de Janeiro—just two years apart during a period of economic recession and political turmoil.
Miroslav Klose of Germany lifting the World Cup trophy with teammates, after defeating Argentina 1–0 in extra time at the 2014 World Cup final.
© Laurence Griffiths/Getty Images
The goal seemed largely symbolic, as it announced Brazil’s arrival as a major global power. But for many Brazilians as well as those who looked beyond the spectacle itself, both events were viewed as a case of misplaced priorities.
Brazil spent an estimated $11.5 billion in preparation for the World Cup. That total covered not only new stadium construction and stadium renovations, but also airports, ports, urban mobility projects, security, tourism, telecommunications, and other event-related facilities. Although estimates vary, about 85% of these expenditures were reportedly funded by the public.
Public frustration began to rise before the tournament began. According to a Pew Research poll in 2014, approximately 61% of Brazilians said hosting the World Cup was not a wise use of public funds, especially at a time when 72% expressed dissatisfaction with the state of the economy.
Many critics argued that the creation and renovation of the 12 stadiums constituted “white elephants”—ambitious projects whose expense far outweighed their return on investment. While several of these venues were used more than expected after the tournament, low profitability, corruption allegations, and lingering displacement controversies raised serious doubts about their true long-term value.
Brazil’s mega-event burden didn’t end with the World Cup. As the tournament came to a close, preparations for the 2016 Summer Olympics in Rio were intensifying. By the time the country hosted the Olympics, it was deeper into recession and mired in political crisis and corruption investigations that led to the impeachment of President Dilma Rousseff.
It’s important to note that neither the World Cup nor the Olympics caused Brazil’s political and economic turmoil. But together, they highlight a larger question: What happens when national ambition, global spectacle, and public money collide during a period of economic insecurity?
Taken together, the U.S. and Brazil examples complicate the assumption that World Cup events produce lasting local economic benefits. While the United States benefited from new market creation and professional soccer infrastructure, Brazil gained global visibility and new or renovated infrastructure. In both cases, however, the economic returns realized by host communities remain a subject of debate.
While Brazil stands as an extreme case, it’s not an isolated one. Other host cities have faced similar concerns at smaller scales. In Canada, projected costs for the 2026 World Cup raised similar questions as to whether the expected economic gains might justify public spending. In Foxborough, Massachusetts, a small town of 18,000 residents, officials raised concerns about traffic, transit strain, and the estimated $7.8 million needed for local public safety costs tied to seven matches at Gillette Stadium.
The 2026 World Cup: One event spread across three countries
The 2026 World Cup’s economic profile is a departure from tournaments past. For the first time, the event is taking place across three countries: the United States, Canada, and Mexico. With participants expanding from 32 to 48 teams, the three-country format helps distribute the financial, logistical, and infrastructure pressures created by the larger tournament.
The new format also changes the event’s risk profile. Unlike Brazil in 2014, which required major stadium construction and renovation, the 2026 tournament is relying on existing major sports venues in all three countries. This reduces the financial risk tied to new construction of venues that may have limited use once the tournament ends.
Nevertheless, the cost of hosting the World Cup remains substantial. Even existing venues had to be repurposed, often requiring natural grass installation, field dimension adjustments, and other modifications to meet FIFA’s commercial and “clean site” standards.
On a city level, municipal services—from street closures and transit planning to emergency services—all exert pressure on the public ledger. The planning burden for a temporary event is still relatively large and costly.
That burden was visible in the months leading to the 2026 tournament. In the U.S., FEMA awarded $625 million in security funding to the 11 host cities. Local officials in Foxborough, Massachusetts, raised around $7.8 million for public safety costs at Gillette Stadium, a figure to be covered by Boston Soccer 2026 with financial backing from Kraft Sports & Entertainment, as local taxpayers adamantly refused to foot the bill. In Canada, Toronto’s cost estimates rose from tens of millions to roughly $380 million. And even in Mexico, the lowest-cost host city of the three, hotel rates spiked nearly 1,000% in certain cities as the tournament approached.
These aspects are what make the 2026 World Cup distinctive. In addition to avoiding the risk of overbuilding, it also mitigates risk by spreading it across several ledgers. However, it remains difficult to measure the costs and spillover effects of a singular event spread across several international locations, agencies, and jurisdictions. All the while, FIFA’s revenue stream—ticket sales, media rights, sponsorships, hospitality, and licensing—remains centralized.
The legacy of mega-events: World Cups, Olympics, and world’s fairs
A world’s fair came and went. The Eiffel Tower stayed.
© Radoslaw Maciejewski/stock.adobe.com
The FIFA World Cup belongs to a family of mega-events that include the Olympics and world’s fairs (now called World Expos). Hosting these events is usually justified by the appeal of legacy: global visibility, civic pride, tourism, new infrastructure creation, and long-term economic development.
Sometimes, the legacy is a lasting one. One such legacy landmark is the Eiffel Tower, built for the International Exposition of 1889 in Paris. Originally intended as a temporary structure, it ended up becoming one of the world’s most recognized and visited monuments.
In the case of mega sporting events, the calculus is similar. The construction and renovation of large venues and transit projects can sometimes serve residents long after the event. Barcelona’s 1992 Olympics and Los Angeles’s 1984 Games are often cited as cases in which the host cities emerged stronger. Hence, the enduring notion that mega-events are a catalyst for civic improvements.
But legacy can also become a liability. Expensive civic upgrades and construction projects can remain costly to maintain, underused, and unprofitable—factors which, over time, can yield damaging consequences, economically as well as politically.
While the success of a mega-event such as the World Cup can be measured by the economic activity taking place during its short duration, its longer-term legacy and effects on the region cannot.
The final whistle doesn’t close the books
The World Cup is, by any measure, one of the greatest shows on the planet. For one month, it commands the attention of billions, gathering sports fans across the globe in a moment of unity and celebration. But the ledger that opens when a host city wins a bid doesn’t close when the final whistle blows. FIFA’s balance sheet differs from that of the host city. And the gap between them is where the real economics of the World Cup resides.