How do Olympic games affect the economy of a country?

Expert Answers
Lorraine Caplan eNotes educator| Certified Educator

Hosting the Olympic games can have a powerful impact upon the hosting country's economy, sometimes positive, sometimes negative, and sometimes not particularly long-lasting. If a country invests in facilities that can be re-purposed in the future, it can be a good investment. Improved infrastructure can make business investments more desirable than they would otherwise have been, providing employment and taxes to the country.  If the Olympics bring people to the country who would never have otherwise come, there are all the tourism dollars.  But there are not necessarily long-lasting effects, particularly with tourism. It is not clear that people have been flocking to Russia, for example, since they hosted the Olympics.  And there are opportunity costs to consider as well. Hosting the Olympics is a costly affair, and one must ask what could have been done with all that money otherwise. It may have been possible to invest it all in the country's future in a way that would have been much more productive, perhaps in education or in tax subsidies to bring in businesses.  Brazil may very well turn out to be a worst case scenario. They budgeted about $13 billion to take care of Olympic preparation, but some are already estimating that the budget has been exceeded by over 50%. They have had many unanticipated problems, corruption, instability, the crashing of oil prices, and now the Zika virus, in addition to having been still very much a third world country to begin with, with poverty, severe sewage problems, and other inadequate or non-existent infrastructure. So, clearly there can be powerful impacts on a nation's economy, sometimes good, sometimes dreadful, and sometimes ephemeral.