Major sports events such as the Olympics are often seen as a potential source of economic regeneration. Yet, they can also effect the economy negatively. These are some of the economic benefits and potential costs of major sporting events, like the Olympic Games, and how they may effect a countries economy.
Benefits of Hosting The Olympics
1. Encourages Investment in Facilities and Infrastructure.
Major sporting events usually require upgrades to transport and communication links. This investment leaves a lasting legacy for the whole economy. Better transport links reduce traffic and helps to improve efficiency for local business.
2. Influx of Foreign Visitors.
A major sporting event like the Olympics can attract tens of thousands of people for the duration of the games. These foreign tourists bring a boost and lift to the local economy. In particular the local tourist trade, shops and hotels will benefit from the surge and significant rise in visitor numbers and people spending money. However, it is worth noting that these visitor numbers tend to be temporary and the visitors leave as soon as the games are over. The major sporting event only lasts for a few weeks; potentially there could be many empty hotel beds after the games and on into the future. Also people will argue that a major sporting event can potentially lead to a long term growth in visitor and visitor numbers. For example China hopes that after the Beijing Olympics, that were in 2008, people will think of China more as a possible tourist destination. Barcelona saw higher visitor numbers continue after the Barcelona Olympics in 1992
3. Job Creation.
Typically, major sporting events require investment in building facilities for athletes and Hotels and tourist facilities for visiting people. This creates jobs for the local economy for up to 4 years before the games. It is hoped that the London Olympics will help regenerate and build up the East end of London.
4. Higher Economic Growth.
It is estimated that hosting the Olympic Games leads to a boost in economic growth due to the higher investment and foreign visitors. This leads to higher revenues for the host’s government.
Costs of Hosting the Olympics
1. Expenses of Hosting
The cost of hosting a major sporting event has increased a lot in recent times. It includes all the investment and also the heightened security and the extravagant ceremonies which are held. It is hard to meet these costs through sponsorship of events and ticket sales. Therefore, it can lead to higher taxes for the local population of the country.
2. Will the infrastructure be used in the future?
The Olympics requires a lot of investment, which may not necessarily be used in the future. This means it will also not generate cash from people in the country using it.
3. Disruption during the event
It is feared that during the Olympics there will be a disruption to some local businesses not directly linked with the games. For example increased security features make it more difficult to continue normal business in some cases.
Evaluation
It depends how much investment and money is required in the first place to get the hgost up to standards. e.g. do all stadiums need to be built
Can Building contractors keep to first off cost estimates drawn up (e.g. New Wembley was much more expensive than first predicted)
Some sectors of the Economy benefit much more where as some will suffer greatly.
Benefits of Hosting The Olympics
1. Encourages Investment in Facilities and Infrastructure.
Major sporting events usually require upgrades to transport and communication links. This investment leaves a lasting legacy for the whole economy. Better transport links reduce traffic and helps to improve efficiency for local business.
2. Influx of Foreign Visitors.
A major sporting event like the Olympics can attract tens of thousands of people for the duration of the games. These foreign tourists bring a boost and lift to the local economy. In particular the local tourist trade, shops and hotels will benefit from the surge and significant rise in visitor numbers and people spending money. However, it is worth noting that these visitor numbers tend to be temporary and the visitors leave as soon as the games are over. The major sporting event only lasts for a few weeks; potentially there could be many empty hotel beds after the games and on into the future. Also people will argue that a major sporting event can potentially lead to a long term growth in visitor and visitor numbers. For example China hopes that after the Beijing Olympics, that were in 2008, people will think of China more as a possible tourist destination. Barcelona saw higher visitor numbers continue after the Barcelona Olympics in 1992
3. Job Creation.
Typically, major sporting events require investment in building facilities for athletes and Hotels and tourist facilities for visiting people. This creates jobs for the local economy for up to 4 years before the games. It is hoped that the London Olympics will help regenerate and build up the East end of London.
4. Higher Economic Growth.
It is estimated that hosting the Olympic Games leads to a boost in economic growth due to the higher investment and foreign visitors. This leads to higher revenues for the host’s government.
Costs of Hosting the Olympics
1. Expenses of Hosting
The cost of hosting a major sporting event has increased a lot in recent times. It includes all the investment and also the heightened security and the extravagant ceremonies which are held. It is hard to meet these costs through sponsorship of events and ticket sales. Therefore, it can lead to higher taxes for the local population of the country.
2. Will the infrastructure be used in the future?
The Olympics requires a lot of investment, which may not necessarily be used in the future. This means it will also not generate cash from people in the country using it.
3. Disruption during the event
It is feared that during the Olympics there will be a disruption to some local businesses not directly linked with the games. For example increased security features make it more difficult to continue normal business in some cases.
Evaluation
It depends how much investment and money is required in the first place to get the hgost up to standards. e.g. do all stadiums need to be built
Can Building contractors keep to first off cost estimates drawn up (e.g. New Wembley was much more expensive than first predicted)
Some sectors of the Economy benefit much more where as some will suffer greatly.
another advantage is bringing all the countries together
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