Ariana De La Cerda
The Olympics, as many may know, are international sporting events featuring both summer and winter sports events. They feature thousands of athletes from around the world, and they participate in a variety of competitions ranging from basketball and tennis to swimming and rowing. It’s an amazing spectacle to witness, and trust me when I say MANY people witness this event. According to People, during the last Olympic games held in Rio, 3.6 billion people tuned in worldwide to watch on the television; along with this number, 7.5 million tickets would be sold to accomodate for the large rush of fans and spectators from around the globe. This was just the last Olympics, only 3 short years ago. With the increased social media presence, advertisements through different platforms, and the anticipation of the next games, the Olympics bring in positive influences on a city, along with negative influences as well.
At first, the Olympics will provide some short term excitement and new found revenue. During the time of the games, a lot of income is displayed: People rent out hotel rooms, buy merchandise related to the spectacle, eat and drink in new spots around the city, and engage in different amusement and recreational activities. With the Olympics only lasting a total of 16 days, this is just over 2 weeks of additional income to a country. While this is positive for a short time, it quickly gets followed up with more issues. This large increase in profit is imperative to pay back the $11.5 million it takes to host the Olympics itself. Then, after the games are all over, the city still has long term issues to face. When looking at the long term effects of Rio in 2016, James McBride states how even as long as a year after the games, “the city still struggles with debt incurred, maintenance costs for abandoned facilities, underequipped public services, and rising crime as candidate cities for future games withdraw their bids or scale down their plans.” This leaves possible hosting countries to be careful about deciding whether or not they would want to host this event; yes, it will bring in short-lived and well remembered successes, but the long-term most sustainable developments must not be ignored.
After looking at some statistics from the previous Olympic games, it is now imperative to look at how Tokyo, the next host, may be affected by this event as well. In just over a year, the Olympic games will resume once again in Japan’s capital, and will once again bring in the many spectators and athletes from around the world. While the Olympics in the past have often brought many issues, the projection towards Tokyo looks pretty optimistic as of now. According to Akira Fuse, the 2020 Olympics in Tokyo could very well offer a temporary boost to Japan’s economy as a whole. There are two fields that could see a change for the better: Increase in infrastructure spending and growth in inbound tourism. Due to all the need for repairments and refurbishments in the city, the GDP is expected to rise anywhere from 0.4%-0.6%. This increase in GDP shows the economy is increasing production rates, while also showing an increase in income as well. Along with this comes the general short-term benefits expressed earlier, which are often referred to as the 7 sectors: Construction, Cement, Housing, Transportation, Security, Media, and Electronics. (Matsuura). These elements, overall, will strengthen the Japanese economy, and will show improvement across the board.
While the previously mentioned long term effects may have harmed other host cities in the past, the future for Tokyo looks bright as of now. They will see developmental improvements throughout the city, and will look to build off of the newly obtained revenue. While they will most likely experience some long term negative impacts, the outlook as of now is positive.
Works Cited
Fuse, Akira. “Tokyo 2020: The Olympic effect on Japan equity investors.” The Capital Group Companies Inc. Apr 26, 2018, https://www.capitalgroup.com/europe/capitalideas/article/tokyo-olympic-effect.html
Matsuura, Hisao. “How will hosting the 2020 Olympics affect Japan?” Nomura, Sep. 2018, https://www.nomuraconnects.com/focused-thinking-posts/how-will-hosting-the-2020-olympics-affect-japan/
McBride, James. “The Economics of Hosting the Olympic Games.” Council on Foreign Relations, Jan 19, 2018, https://www.cfr.org/backgrounder/economics-hosting-olympic-games
Pearl, Diana. “4,900 Medals and 6,000 Hours of TV: The Rio Olympics by the Numbers.” People, Aug 3, 2016, https://people.com/sports/rio-olympics-2016-facts-by-the-numbers/
After reading this article, I question Japan's ability to pull this off and remain economically secure post-olympics. I know that currently Japan is faced witha. unique age structure in which almost a third of the country is over the age of 60. This could present issues when faced with employing individuals to design, build, organize, and work at the Olympics. It is likely that there will eb a shortage of labor and perhaps Japan will need to recruit workers from other areas to compensate for their small working population. This could result in higher wages for those workers, and increase production costs for the Olympics, further contirbuting to the economic stress the Olympics can have on a country.
ReplyDeleteI would disagree with this; all of the work for planning of the Olympics has already been done by this point really, with the remaining work to be done being on finishing up construction, and little has been had to be built, as most sites for media and sporting events already exist, and infrastructure in Japan is already incredibly robust, especially between the cities where events are being held. The Rio Olympics were unique in that Brazil was reeling economically coming off the heels of the '09 Recession which crippled their economy after years of unprecedented growth, forcing compromises on plans that would eventually still go over budget and overall making the Games fairly disastrous for the city. The Tokyo Games would meanwhile be more comparable to those in Pyeongchang in 2018; both countries have high income economies and spent relatively little on planning as much of what was needed was in place and Pyeongchang, despite going over budget and having issues with attendance due to tensions with their northern neighbor, still profited from the games.
DeleteCan Japan really be one of the first countries to not go in dept after the Olympics? I don't think that they will. If nearly every country before them has gone into dept after Olympics what makes them think that they won't. Japan is a somewhat populated country, but with certain trends there is less and less young people. Will they have enough people to help out with the building of these soon to be abandoned places and to work at them.
ReplyDeleteAlthough you said the future of Japan is looking bright, I can't help but wonder what will happen to all the infrastructure they built solely for the olympics. Every four years, new arenas are set up to sustain the olympic games yet they rarely seem to be used after that. You mentioned that this definitely will boost the economy for a short amount of time while there is an influx of tourists coming to see the games, people buying hotel rooms, merchandise being purchased and more, but the long term effects don't seem to be as positive. Like you said with Rio, they're still struggling more than a year after the olympics ended because the buildings cost so much to make, and now even though they're abandonded, the maintenance costs remain. The outlook remains positive though, and perhaps their economy will flourish with the 2020 olympic games.
ReplyDeleteI agree that the Olympics can help boost a country’s economy since their are so many people willing to go watch the events. Billions of people went to watch the last Olympics in Rio, so I assume that the same amount will go to Tokyo in 2020. The benefits of hosting the Olympics is that it does bring in income and increase GDP, since visitors have to stay in hotels, eat out or buy merchandise. Not only is their numerous consumers, Japan will have to hire more workers which will increase employment rate. However I feel that some downfalls of hosting the Olympics are that it can increase crime in the city and production increases which can impact the workers.
ReplyDeleteThe Olympics does impact the economy in many ways. As millions of people go and watch the games, so this makes more people purchasing flights, food, or paying for a hotel to stay at. There will be a huge increase in spending so the demand for products will be very high. The Olympics also creates millions of viewers watching the games on television which really helps the advertising and marketing field. As they will be competing over who’s advertisement can be in the games. They want their advertisement to be in the games because so many people are viewing the games so they can get their message across to millions of people in a quick amount of time. After the games though is when the economy will struggle. There will need to be lots of maintenance work and construction since the new stadium needs to be built and this costs lots of money. After the games there will also be a decrease in spending. But the Olympics will cause a positive effect on the Japanese economy overall because hotels, food industries, transportation, and merchandise stores will all make lots of money.
ReplyDeleteThe Olympics is a great event for any host country due to the populism and attraction involved with tourism of the city due to the games. Before the games, many people are getting ready for the Olympics and preparing my booking hotels, creating an entire vacation, and building centers for the games to be held. As a result, this is boosting the economy due to the positive effects and the advancement in technology and popularity. When, the games come around so many people experience the Olympics by buying tickets and other revenue while touring Tokyo. Yet, while this increases the economy, the negative side comes when the games are done. Tourism decreases, the buildings are gone to waste, and there is a slow in the economy. As a result, the country slows down. So does this mean that there will be a bigger decrease in GDP due to the game than increase due to the negative effects? Will citizens start to look poorly on their country and spend less money on boosting their economy like paying taxes for keeping up the city? I believe that Tokyo will also be better off than Rio due to Tokyo being a more advanced country than Rio and more wealthier citizens to take care of the country afterwards. Overall, I agree that Tokyo will have an increase in GDP and the Olympics will boost its economy, yet I also believe that there will be negative affects yet not as severe as Rio.
ReplyDeleteJapan, has been a country that dominates many industries, such as the auto and electronics industries, and has proved itself as one of the biggest global super powers. I believe that Japan has the ability to bounce back and not follow the trend of the previous olympic hosting countries. Because the GDP and output of Japan is already soaring and positive, the debt that the Olympics bring with them, will cause a dent in Japan's GDP, but not a major dent. However, one thing that can be severely impacted is the unemployment rate. Because the Olympics need a huge number of people to work on it for at least 4 years, after the Olympics are finished in 16 days, these people will no longer have jobs. This was cause an increase in unemployment rate and Japan needs to have a plan to combat it.
ReplyDeleteThe Olympics are a sight to behold, along with them they bring a lot of money. The amount of money that is generated by a host country is unimaginable. People from all around the world are willing to travel to these countries spending money on food, water, hotels, clothes, tickets, and so much more all because of the Olympics. I believe the 2020 Tokyo Olympics will strongly help increase Japans GDP because of all the money that will be brought in.
ReplyDeleteThe Olympics serve as a great opportunity for countries to get world wide recognition and to bring in short term revenue, as you mentioned. I think Japan will do better than past countries have, as they are more economically stable. The olympics were brought to Rio in 2016 with intentions of stimulating growth within their economy, however, it harmed more than helped. For one, to build the "Olympic Villlage", citizens were evicted from their homes, and this went on to spur greater poverty and unhappiness within this nation. Additionally, armed forces were hired to protect the athletes, leaving Rio's most dangerous neighborhoods subject to life threatening gangs. Lastly, Rio was left in a recession, adding on to the three years that came before hosting the Olympics. So, yes, they can offer opportunities for small business owners, specifically owning tourist shops. But, overall, to host the Olympics, a nation must be in great economic stability to prosper.
ReplyDeleteI never really thought about how the Olympics would affect the economy and area of the place in which they are held. As I read I thought about it this many people in one area would be good for the environment. If you think about it this many people, in addition to their already large population could be an overabundance of people, garbage, cars/transportation. I wonder if the good outweigh the bad in this situation, because there is also a lot of revenue that comes with hosting Olympics so that would be beneficial to the economy.
ReplyDeleteIn terms of the Olympics being in Tokyo it offers a great increase for their economy. The Olympics is one of the biggest events that happened world wide, where lots of money is put into the event for the entertainment of people world wide, expressing great nationalism. Since so much money is put into the Olympics wherever they are held gains a lot of revenue. This helps benefit the country, and gives them opportunity to grow. Therefore the Olympics offers different countries every four years to increase their economy by holding this money making event.
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ReplyDeleteThe Olympics are one of the most watched televised events in the world. The event draws in audiences from all around the globe to watch athletes compete in a variety of different sporting events. I think that it was interesting to read about some of the negative economic effects of the Olympics because when most people initially hear about a country hosting the Olympics they immediately think that it is only good, financially speaking. And, for the most part it is a positive for the country’s economy. The initial cost of building the facilities for the games is often offset by the income from the events surrounding the game themselves. However, after the games are over is when economic issues can arise since the facilities are now not being used, and likewise are not drawing any income. I think that a country should have a plan for the facilities after the games, in order to continue to earn income off of their expenditures, even if it is just a little bit of money, it could still help a country remain financially stable. Perhaps they could turn the facilities into practice facilities for younger athletes, or turn the Olympic Village into a mass hotel structure and continue to earn revenue that way.
ReplyDeleteHaving the Olympics in Japan I think will help boost their economy. With the all of the athletes and spectators all willing to go down there. Plus with the billions of people watching it at home that will for sure benefit Japan and bring in income plus increase in GPD. Knowing that Japan is looking good has of right now to host the Olympics I still feel that they will have issues along the way. Knowing that in the past with Rio and other past countries that have had issues hosting the Olympics I think that Japan can learn from them however I still feel that they may still have problem.
ReplyDeleteI agree with the other commenters that the economy of Japan will very much likely increase because of the Olympics. However, there is a good chance the country could fall into deep debt because of the cost of building large arenas for the sporting events. Other countries that have hosted the Olympics find they draw more people to the country, even after the big event because of the increased knowledge of this city. Japan is becoming a popular tourist destination in the past couple of years, and I think this will increase even more because of the Olympics, which will cause the country to bring in even more money.
ReplyDeleteI agree, whatever country that has the Olympic will be able to have a great run for their economy within the time that the Olympics are there. However, whenever you look at the aftermath of the Olympics, you see that now they have these massive stadiums that now just sit there and are unused. This happened to Brazil now they have all these stadiums that they needed for the Olympics but now serve them no purpose. Also, countries after the Olympics always are going to have debt. And it's extremely difficult to recover from this massive debt, especially if the stadiums they built don't bring in money for their country. It'll be interesting how Japan pans out after the Olympics and see how much debt they'll have to recover from.
ReplyDeleteI thought your take on the economics of the Olympics was interesting, and recognizing specific sectors that will benefit from the Olympics was a good specific. However, I thought the post could have been clearer on how exactly Japan differs from other countries that have held the Olympics and what allows it to make only gains where other nations saw long term losses. Besides this, I thought it was interesting to think of the connections between the losses associated with hosting the Olympics versus those associated with hosting other major sporting events. Countries experience similar problems when hosting the World Cup, as stadiums built often cost enormous amounts, and are then completely unused after the event. This makes me wonder if there are any major international events that are regularly profitable for the host.
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