Bella Galewski
The Olympics started in Ancient day Greece and evolved into what is now the modern-day Olympics. It brings in thousands of tourists from all over the world. And therefore also brings in revenue for the cities that host the Olympics. However, there is also a negative of countries hosting the Olympics. The costs. There are many costs for hosting the Olympics, the stadium, the opening ceremony, the closing ceremony, medals, equipment, etc. But is hosting the Olympics worth billions of dollars.
Countries that host the Olympics invest billions of dollars to boost tourism, and build their country more. However, few countries profit from hosting the Olympics. According to Manning and Napier, “Athens’ 2004 Summer Games put Greece $14.5 billion in debt. [...] Los Angeles in 1984 was the first city to profit from hosting the Olympics” (Manning and Napier). The graph to the right reflects the costs of hosting the Olympics for 10 different countries. As you can see, the cost of hosting the Olympics has gone up over the last decade due to more elaborate opening and closing ceremonies and various other expenses. “The first city to profit from the Olympics was in 1984” (Manning and Napier). Our modern-day Olympics didn’t start until 1896. That’s almost a century after the Olympics started. When you factor in all of the costs of running the Olympics, it’s no wonder the demand to host the Olympics has gone down. The opportunity cost of the Olympics is just not worth it. The graph to the left shows the profit/loss/break even for cities that have held the Olympics since 1982. As you can see, cities that did make a profit, had a marginally small profit because the costs of holding the Olympics are very large. The graph contains 8 countries that held the Olympics. Of those 8, only 3 experienced a profit, 4 countries lost money, and only one country broke even, meaning they did not lose or gain money.
Countries do however see a growth in tourism, and sometimes economic growth because the Olympics does bring in thousands of visitors from all over the world. According to Olympic News, the Olympic games of 2016 led to an increase in tourism over the next 12 months for Brazil. Brazil saw a 4.8% increase in foreign tourism. That meant that there were roughly 6.3 million tourists more than Brazil usually had. That’s a lot of tourists. And Rio also had economic growth that didn’t weaken until 2018. According to Olympic News, “job creation accounted for 83% of Rio’s economic growth [...] The income of the poorest 5% also grew 29.3% against 19.96% of the richest 5%” (Olympic News).
After looking at both the cost and benefit of hosting the Olympics, one has to conclude is hosting the Olympics worth the economic growth that may occur, or the economic distress that may occur as a result of the billions of dollars spent. Will the Olympics draw in more revenue or will the city suffer as a result? After looking at the economic impacts of hosting the Olympics, the costs of the games greatly outweigh the benefits of hosting the Olympics. What do you think, are the Olympics worth the money and risk?
Works Cited
“The Economic Impact of the Olympics.” Manning & Napier, www.manning-napier.com/insights/blogs/markets-and-economy/the-economic-impact-of-the-olympics.
Ioc. “Olympic Games Rio 2016 - Economic Legacy.” International Olympic Committee, IOC, 1 Dec. 2018, www.olympic.org/news/olympic-games-rio-2016-economic-legacy.
“Miracle on Mice - Jack Luan: Ivey Business Review.” Jack Luan | Ivey Business Review, 26 Mar. 2014, iveybusinessreview.ca/blogs/jluanhba2015/2014/03/21/miracle-on-mice/.
“The Penn Museum.” Penn Museum, www.penn.museum/sites/olympics/olympicorigins.shtml.
Ptbacon. “The Rugby World Cup Is Coming – but Are the 'Big' Sporting Events Worth the Cost?” Bacon's Grilling, 12 Sept. 2015, baconsgrilling.wordpress.com/2015/09/12/the-rugby-world-cup-is-coming-but-are-the-big-sporting-events-worth-the-cost/.
I liked how you talked about both the positive and negative aspects of hosting the Olympics. I think there should be a way to benefit more poor countries by hosting the Olympics in their countries and having other places raise money for them. Like you said, although hosting the Olympics does cost a lot of money, it also brings in a lot of money and gives those countries recognition and economic benefits. So, by potentially hosting the Olympics in poorer places, that will allow those countries to better themselves economically in the future.
ReplyDeleteIt never dawned on me that the Olympics are as expensive as they are. Sure, I knew that new buildings are built and it is customary to have extravagant opening and closing ceremonies but I figured that tourism and any souvenirs would offset those costs. It’s interesting that countries would still even want to host the Olympics after knowing how much of a potential toll it could take on their cities. But I guess you won’t know until you try it for yourself to see if it really does boost tourism as much as one hopes it will.
ReplyDeleteI thought your blog post was really interesting; especially since the Olympics are coming up. I always thought that the Olympics was good for the country that held it, due to the fact it’s bringing so many tourists in like you mentioned. However, I didn’t know that countries were actually in debt from it. In 2016, Brazil held the Olympic games and there was a Zika outbreak I would be interested to see how that affected their debt vs tourist income. I feel like this outbreak would have had more of a negative effect, since not as many tourists came and some countries didn’t allow their athletes to go. However, it would be interesting to see the actual economics behind it.
ReplyDeleteI never thought about the economic impacts the Olympics have on the place where it's being hosted. However, I don't think the Olympics was ever intended to be a way for whatever country hosting it to make a profit. I think the main reason the Olympics exists is to showcase world class athletes and inspire people. Whether the Olympics is worth the risk is up to the country hosting the event. Some countries may be better suited than others.
ReplyDeleteYou would think that after hosting the Olympics you country would really benefit from this since the Olympics is a worldwide competition. I never really thought about the cost that goes into the Olympics like setting it up and the ceremonies. I can see how a Country would not profit from the Olympics due to the all the costs that the Olympics require. I do however, could definitely see how the Olympics lead to an increase in tourism because people not only go to watch the games but they can also see what the Country looks like on TV, and have an interest to visit that Country. I feel as though the Olympic games is worth the money and risk because I think a Country could really benefit from the games but I could also see why a Country wouldn't want to host the Olympics because you could really risk a lot.
ReplyDeleteHosting the olympics definitely poses great risks economically. It’s hard to determine if the cost is worth the benefit because in many different scenarios the marginal benefit may be different. One country might bring in more revenue than another country when hosting the olympics based on externalities around that country specifically. While a chance is presented to take the risk, based on the evidence you provided I have to agree with your argument. The cost of the games greatly outweighs the benefit and because of that it is not worth the risk.
ReplyDeleteThe Olympics draw in millions of viewers and thousands of tourists. With this in mind, it would seem that host countries profit from hosting the event. I was surprised by how often countries lose money by hosting the Olympics. When Rio was hosting the 2016 Summer Olympics, they spent an estimated $12 billion (while true costs rose above that estimate). At the same time, Rio had cut spending on health care and education, failed to pay police for weeks at a time, and did nothing to help the roughly 20 percent of their population living in slums. Countries may put aside their own needs for the honor of hosting the Olympics (or, realistically, to take advantage of the great number of tourists the Olympics brings to the host country). In addition to potentially causing problems (similar to what Brazil saw), the Olympics are more likely than not to add onto a country’s debt. Another issue is the abandonment of Olympic facilities. After the Games, some new stadiums are left unused. Other times, countries spend even more money to transform the venues. What will happen if eventually no city wants to host the Olympics? Will we end the 123-year tradition?
ReplyDeleteI agree that hosting the Olympics may or may not be worth it. It is completely dependent on the amount of tourism the games bring to your city. It is obvious that the cost of hosting the Olympics is rising at a crazy rate and if many tourists are brought to the city it will be worth it. If the Olympics don't bring in tourists then the high costs will most likely not be worth it.
ReplyDeleteThis is so interesting! I never thought about the money that goes into the Olympics for each country and the debt it causes countries to go into. I honestly thought that the Olympics were mostly funded by sponsors so that all the cost wouldn't fall onto the country. But you proved me wrong! Although the Olympics cost a fortune for the host country, they still have to take place! The Olympics have been such a long tradition in the world's history-123 years to be exact. Without the Olympics there wouldn't be any prestigious platform for athletes around the world to compete for. Therefore, since the cost of the Olympics has generally increased over the years, the countries should invest less in the opening and closing ceremonies. Does anyone really watch them anyways? I personally don't! Instead, if the host country still desires to spend that money (which they probably don't), they can spend it on the facilities and meals for the athletes in order to ensure that they are to the highest quality.
ReplyDeleteHosting the Olympics is worth the money in the end. The Olympics is such a key part of the world and it lets athletes from all over show us how good they really are. It is an opportunity to connect with other countries and to help create that bond with each country. Hosting the Olympics is not about the money it’s about athletes around the world representing their country. Yes it does cost a ton to host the Olympics but the countries know that and I think that they wouldn’t host if they didn’t know how much it would cost. I just feel like the Olympics is such a big event in the world and its every 4 years. We can’t just take it away plus I feel that we haven’t had many problems money wise when talking about the Olympics.
ReplyDeleteThis is really interesting since often enough, countries fight over being able to host. But it's incredibly expensive. Does the tourism it bring overcome the debt? The most recent Winter Olympics in South Korea really put South Korea on the map and they were able to share their culture throughout the world. However, South Korea was already a major business nation even before the Olympics so they really didn't need the extra tourism. It seems that hosting the Olympics is more of a problem than an opportunity for economic success. Very interesting topic!
ReplyDeleteThis is a very interesting topic that has a lot of data for both the pro and co side. I liked how you addressed both sides of the story. Hosting the Olympics is not something that a country can think about lightly. This is a serious choice that needs to b considered and like you mentioned it is a huge financial burden. A key component is being able to 'front the money.This is a huge risk that you are going to spend an absorbent amount of money to spend on something that is not going to grunted profit. As you can see from the graph it is very inconsistent, there is no tend associated with the profit that you are going to receive. Yes it might increase tourism for short period of time. Now that is something that needs to chosen between. This is like an investment, and how risky are you willing to be. You are planning on spending billions of dollars for some potential profit. That is what all of the countries have had to think about, some chose to take that risk and others do not.
ReplyDeleteI see this like investing in a very risky stock. Being a large high risk investment, you need to understand all the external factors as well. If the city does not have a strong existing transportation system, that is an additional cost that could effect the outcome as well. I think this is one of the topics that is dependent on each city as to whether it is worth it. If the city is not lacking the income and would only overpopulate by hosting, I don't see that as a beneficial investment but if the economy is struggling, this could be a way for the economy to get back on track.
ReplyDeleteI was really surprised to see that the Olympics aren't as profitable as we often times believe it to be; I was previously aware of all the costs that go into preparing for such a huge international event. Do you think that there could be ways to reduce said costs? Maybe the burden can be shared among different countries, not just the hosting country? Are there other ways that we can continue with the Olympic Games while still being cost efficient?
ReplyDeleteI've never really thought about this topic before, but it is really interesting. It definitely makes sense though that countries would have to spend a ton of money for these competitions, but you'd think there'd be some big benefits to hosting it.
ReplyDeleteI would have to say the Olympics are risky to host and their are so many ways that a country can loose money form hosting the Olympics. When a country hosts the Olympics the other countries in the Olympics should help to support the host. They should do this because the Olympics are a huge part of the world today and mean a lot to many people all across the world because at the Olympics countries come together to compete in sports rather than war. Overall the Olympics should still occur but they hosting them isn't the best investment so one of the only solutions i can think of is having the other countries in the Olympics help pay for them.
ReplyDeleteI’ve always known that hosting an olympics was a lot of money. They have to build entire towns and infrastructures - years of planning and construction going into only two weeks of use. I never really considered where the money is coming from, though. I always naively assumes that the whole world paid for that planning and construction, not just the hosting country. I also assumes the benefits outweighed the deficits, otherwise why would anybody choose to host it, right? Instead, countries fight over hosting them, and beg for the job. This must mean that all of the tourists and money make up for the time, money, and effort and ultimately benefit the economy. But judging by the data you used, I was mistaken, and this is not necessarily the case. Crazy!
ReplyDeleteIt’s very interesting how much money it takes to host the Olympic games. What’s even more interesting is the fact that many countries fight for the chance to host these games. Even tho there must be millions of dollars put into the games, countries are willing to pay that and more if it means that their country will be broadcasted all over the world. I think that one of the biggest reasons for this is, the large amount of tv time the country gets. Meaning that every time that the Olympics are announced on tv, the country is able to implement different factors , that would make people visit or live in the country.
ReplyDeleteIn the beginning this topic was very superfluous to me but now you have made it evident that this is a topic that people should convene more of their time with. The thought of this very vex topic is amazing and for you to do it so well makes you savvy. I believe that this is only one microcosm problem that could lead to something larger. Your ability hone in on it though was simply paramount
ReplyDeleteI was aware of how expensive the Olympics was, but I always just assumed that the cost of the tickets would outweigh everything else and allow the country to profit. I do think that it is worth it to host the Olympics, however, since in the long run it seems that tourism would increase in the country. Lots of countries typically spend lots of money on new stadiums for the Olympics, but do not use them much after that. When I stayed in Spain, one of the hotels I stayed at was an old Olympic center that was renovated into a hotel. If countries are able to make use for all of these costly new buildings after the Olympics are done, I think hosting the Olympics are worth it.
ReplyDeleteThis topic right away caught my attention because to me its not something thought about by many people. I liked how you included graphs so the reader could have proof of some data. You also did a very good job of explaining how important this topic is and how it should be thought about more.
ReplyDeletePersonally, I really enjoy watching the Olympics so reading about the effort and money that goes into hosting the massive event was interesting. I guess I never really realized the amount of money and planning that has to go into hosting. I thought that it was a group effort throughout the whole world instead of just the hosting country. The hosting country can showcase their best features which I believe is a great benefit. Although it may take a while to comeback from the deficits, the Olympics can really boost the country's economy in the long run. I think if no country offered to host the Olympics millions of people would be disappointed and would hurt the economy more than having the Olympics in the first place.
ReplyDeleteI was genuinely surprised to see that the Olympics really profitable at all, considering the event has such a big spotlight on it when they go on. When you take this into consideration, it does take away from the sanctity of the event, especially when you consider some of the dark history associated with the Olympic Games. Beforehand, I was aware of all the costs that go into the preparation for such an event, as there are many documentaries about the struggling financial statuses of countries that need to quite literally build everything for the events, but your explanation really put those financial concerns in a much more comprehensible manner.
ReplyDeleteIt's fairly common knowledge that countries end up spending more on hosting the Olympics than what they make from tourism, but this was great to actually see the numbers behind it. Maybe a classic example of this was back in Germany before WW2, when Hitler and the Nazis built up an entire "paper city" to look glamorous in front of the rest of the world when the country was actually facing an economic nightmare. Both then and now, countries are under pressure to look sophisticated, advanced, and picture perfect during the Olympics when the rest of the world is watching. This was really interesting to read and you had great infographics. Awesome job!
ReplyDeleteI never thought about the economic impacts the Olympics have on the place where it's being hosted. However, I don't think the Olympics was ever intended to be a way for whatever country hosting it to make a profit. I think the main reason the Olympics exists is to showcase world class athletes and inspire people. Whether the Olympics is worth the risk is up to the country hosting the event. Some countries may be better suited than others.
ReplyDeleteI definitely think that the olympics are a waste of money for host cities if they need to build new venues for these activities, because you get these multimillion dollar structures that are built to host a competition for a few weeks and then they never end up getting used again after those weeks.
ReplyDeleteI had never really thought about the lasting effects that hosting the olympics had on things like tourism. So this was an interesting thing to read as it has made me think more about the post olympic impact of the games, like income from tourism and increase in income.
ReplyDeleteI never thought about how the hosting country would benefit from hosting the Olympics. This was a really interesting topic. Though I don't think that the goal of the hosting country is to make profit.
ReplyDeleteI liked how you included both the positive and negative effects of hosting the Olympics. Although it costs a lot of money to put on the Olympics, the amount of tourism the is attracted to the city will help the economics a lot and help balance out the cost. Personally I just never thought the Olympics was that much to put on so I was very surprised that countries were going into debt.
ReplyDeleteWhenever I think of the Olympics, I think about how much they could make with all of the attendance. What I don't think about is how much they are losing. With all of the large stadiums and equipment needed, the cost is crazy. I really liked how you included the "profit" with how they lose and make money. I also found your visuals perfect for what you were writing about.
ReplyDeleteOlympics is a detriment to a country, a prime example is Brazil and how the stadium they built for the Olympics is now completely empty. Economically in the short term, it does not make sense to host it. But you have to see the broader benefits of hosting the Olympics, you can use the platform to change the perception of your country. From the stadium to the ceremonies that you can use to increase nationalism and show your culture to the world. This could be beneficial for international relations and the perception could be economically beneficial. If people like your art or the stadium is built well, then people could get a perception that your country is high quality and goods made from your country means that it is well made: Such as European countries. Countries with a bad reputation like Russia and China benefit from Olympics as their reputation is bettered unless you have bigger problems such as poverty and economic recession. Such as Brazil but if you are Qatar and are flowing in money but have a image problem, it is worth it for Qatar but not for Brazil.
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