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SHOULD CITIES GO FOR THE GOLD? THE LONG‐TERM IMPACTS OF HOSTING THE OLYMPICS

SHOULD CITIES GO FOR THE GOLD? THE LONG‐TERM IMPACTS OF HOSTING THE OLYMPICS The Summer Olympics bring hundreds of thousands of visitors and generate upward of $10 billion in spending for the host city. This large influx of tourism dollars is only part of the overall impact of hosting the Olympic Games. In order to host the visitors and sporting events, cities must make sizable investments in infrastructure such as airports, arenas, and highways. Additionally, the publicity and international exposure of a host city may benefit international trade and capital flows. Proponents argue that this investment will pay off through increased economic growth, but research confirming these claims is lacking. This paper examines whether hosting an Olympiad improves a city's long‐term growth. In order to control for the self‐selection of cities that host Olympic Games, this paper matches Olympic host cities with cities that were finalists for the Olympic Games, but were not selected by the International Olympic Committee. A difference‐in‐difference estimator examines post‐Olympic impacts for host cities between 1950 and 2005. Regression results provide no long‐term impacts of hosting an Olympics on two measures of population, real Gross Domestic Product per capita and trade openness. (JEL O18, R11) http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Economic Inquiry Wiley

SHOULD CITIES GO FOR THE GOLD? THE LONG‐TERM IMPACTS OF HOSTING THE OLYMPICS

Economic Inquiry , Volume 50 (3) – Jul 1, 2012

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References (51)

Publisher
Wiley
Copyright
© 2011 Western Economic Association International
ISSN
0095-2583
eISSN
1465-7295
DOI
10.1111/j.1465-7295.2011.00373.x
Publisher site
See Article on Publisher Site

Abstract

The Summer Olympics bring hundreds of thousands of visitors and generate upward of $10 billion in spending for the host city. This large influx of tourism dollars is only part of the overall impact of hosting the Olympic Games. In order to host the visitors and sporting events, cities must make sizable investments in infrastructure such as airports, arenas, and highways. Additionally, the publicity and international exposure of a host city may benefit international trade and capital flows. Proponents argue that this investment will pay off through increased economic growth, but research confirming these claims is lacking. This paper examines whether hosting an Olympiad improves a city's long‐term growth. In order to control for the self‐selection of cities that host Olympic Games, this paper matches Olympic host cities with cities that were finalists for the Olympic Games, but were not selected by the International Olympic Committee. A difference‐in‐difference estimator examines post‐Olympic impacts for host cities between 1950 and 2005. Regression results provide no long‐term impacts of hosting an Olympics on two measures of population, real Gross Domestic Product per capita and trade openness. (JEL O18, R11)

Journal

Economic InquiryWiley

Published: Jul 1, 2012

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