What Are Economic Merits and Demerits of a Country Hosting the Olympic Games

Abstract

The Olympic Games, from their initial competitive bids for hosting, have evolved to a situation where fewer countries are applying to host. The operational costs of the Olympic Games have been increasing, while the economic benefits that can be gained have become harder to recover. This article compiles numerous economic essays, categorizing them to summarize and analyze the inherent economic advantages and disadvantages of hosting the Olympic Games. The benefits of hosting the Olympic Games for local and national economies show in many different ways. For local economy, Hosting Olympic Games can enhance more infrastructure and boost the service sector economy. Hosting Olympic Games can not only lead to positive outcomes for local economy, but also provide positive outcomes for the entire country such as enhancing the manufacturing industry economy, increasing GDP, increasing employment rate. However, there also are drawbacks to host the Olympic Games for a country's economy such as significant resource wastage, short-term price increase, short-term government budget deficit, and high risks of unexpected future. Finally, the government should balance advantages and disadvantages to make a correct judgment on whether hosting Olympics Games or not.