The 2000 GOP convention was held in Philadelphia, Pennsylvania. During the very short time that the convention was in process, the city was teeming with activity. Although the convention itself was held mostly at the First Union Center, the economic impact stretched well beyond the South Philadelphia Stadium Complex. CNN estimates that total attendance included 20,000 protestors, 2066 delegates, 2066 alternate delegates, 10-15,000 volunteers, and 15,000 members of the media. This massive influx of short-term visitors to the city created a surge of economic activity.
The estimated direct expenditure alone was in excess of $100 million-a nice shot in the arm, especially given that the total cost was only $63.5 million, of which $13.5 million were federal funds. Retailers, restaurants, hotels, city attractions, and even street vendors all benefited. In the hotel industry alone, 20,000 rooms were booked for the convention. Although not a permanent increase in economic activity, major events such as conventions and Super Bowl games do increase demand for local goods and services. In some cases, new sources of supply may be brought in to help meet this demand, such as rental cars from other areas (General Motors supplied 420 loaners). In most cases, however, the supply of services is fixed, and the increase in demand can mean price increases and big profits for sellers. More uncertain are the indirect benefits claimed from the convention and other similar events. Again, CNN estimates that over $200 million in indirect (multiplier) revenue was also generated by the convention.
1. Can you think of constituents in Philadelphia who would not want the city to host the convention?
2. Use a series of graphs to show changes in four separate markets that would be affected by the convention.