KESPA highlights the economic power of esports events in South Korea

The Korea e-Sports Association (KeSPA) has published a study on the ‘Expansion of Economic Effects and Tax Benefits of E-Sports Competitions’ in South Korea.

Conducted last year and published today, the study aimed to highlight the economic impact of key esports events held in the country over the past years. Moreover, it highlights the goal of establishing a tax benefits framework for esports athletes and companies, as well as expansion plans for the sustainable growth of the esports industry.

The report also analysed the economic impact of esports tournaments in the past five years, explaining how previous methods focused on traditional sports were considered inadequate to reflect the core values of competitive gaming. This includes utilising digital viewership and IP licensing.

As a result, KeSPA developed and applied a specialised model, MEEI (Multi-layered Esports Economic Impact). This model quantifies tangible and intangible value by using digital indicators such as online advertising and global fandom consumption patterns, as well as considering added value across upstream and downstream industries such as tourism, lodging, and more.

According to the report, this model showed a stronger economic impact in the analysed events. The 2023 League of Legends World Championship, for example, generated a production inducement effect of 740bn won (~£378m), compared to the previous estimates of approximately 200bn won (~£102m). Other domestic events, such as the 2025 LCK Finals and T1’s Homeground event, also registered significant results, with an estimated 58.5bn won (~£30m) and 30bn won (~£15m), respectively.

Despite having major competitive success both domestically and, most importantly, internationally, the Korean esports industry is also facing major financial pressure, with esports teams not being able to make an economic return through franchising revenues. Player salaries have also skyrocketed in recent times, occupying over 70% of the teams’ budgets and reaching a total of 96.3bn won (~£49m), according to the report.

As a result, the association also proposed changes, such as expanding tax credits for team operating costs to facilitate corporations entering and investing long-term. The proposal also highlights new investment credits and R&D tax credits to reduce IP dependence, while supporting technologies that can be applied beyond the single game title.