By Michael O’Leary, Guest Contributor, Sports+Fitness Network and
Lisa M. Miller, Ph.D., Editor, Global Sport Management News
Have you always wanted to attend the Olympic Games? The Olympic Games are an integral part of society today with a rich history. The mega event sets the stage for competing countries to show prowess on a world scale. One topic behind the glorious events is the impact the Olympic Games has on host cities through the enormous financial gains and costs associated with hosting the events as well as the ecological footprint left behind in the city. In recent decades, the bids from competing cities around the world to host the Olympic Games have grown to enormous proportions backed by the prospect of revenue generated from infrastructure upgrades, broadcasting rights, and tourism. In addition to the financial gains associated with hosting the games, countries use the Olympics as an opportunity to show their political strength in an effort to better portray their image on a global spectrum. Another aspect for altruistic vigilance is the impact the Olympic Games has on the environment of the host cities. The International Olympic Committee created a priority to minimize the ecological footprint and in some cases has actually improved conditions. Some host cities, however, end up exploiting their natural resources. Ultimately, does hosting the Games truly offer enough tangible benefits despite the grand pageantry of attending the events? In fact, many studies indicate the costs associated with hosting are often under-estimated and profits significantly over-estimated. This often leads to dissenting opinions as to whether or not the Olympic Games truly provide long term investment opportunities and increased wellness for the people of the hosting country.
Countries are enthralled with the Olympic Games and willing to spare no expense for their pursuit to host the Games. The driving force behind the large investments toward the pursuit of hosting the games can be attributed to the economic impact the mega event presents in the means of ticket sales, tourism, investments into the city’s or country’s infrastructure, and increased employment opportunities. The success of the Los Angeles Olympics resulted in a surplus of 250 million dollars and has since been a catalyst for cities bidding to host the event (Kirkup & Major, 2006). Although these had been the most successful games up until this point, the success was not based off how much revenue was created, but rather how much was vigilantly saved through the utilization of previously built facilities and stadiums. Both the Atlanta and Los Angeles Olympic games constructed very few facilities and also kept costs lower by housing athletes in dorms as opposed to constructing new expensive facilities. Another major incentive for hosting the Olympic Games is to improve country or nation branding. “Country branding is the process of establishing positive associations for the nation, its people, and its products to better compete in a global market” (Sun & Audwish, 2012). Mega sporting events like the World Cup and the Olympics are an integral component for increasing global awareness due to the increased media attention and coverage. Host countries take full advantage of this opportunity to enhance their competitive positions. For instance, the Seoul Olympics helped to improve the image of South Korea, whereas Australia used the 2009 Sydney Olympic Games to promote tourism. China advertised the 2008 games as the people’s Olympics, the high-tech Olympics, and the green Olympics to improve their image globally. More recently, Vladimir Putin used the 2014 Winter Olympic Games as a way to show the world that Russia rebounded to once again be among the most powerful countries in the world. In 2012, Sun and Audwish conducted research through qualitative analysis to measure the success of hosting the 2008 Beijing Olympics had on US consumers. The results indicated the Olympic Games improved China’s image with the international community. Global success of the games could significantly improve the economic positioning of the country. Another positive to a vigilant approach for the greater good is that the Olympic Organizing Committees have been increasingly aware of the potential for using Olympic activities and facilities as experiments in technologies that may have important positive benefits to the planet (Collins, Jones, & Munday, 2009).
Many studies also illustrated the need for altruistic vigilance of the costs associated with hosting the Olympics. These costs may outweigh the potential benefits and also produce minimal lasting long term effects. The reason behind these misconceptions generally occur due to hidden costs associated with heightened security and infrastructure issues. Total cost through the bidding process increased to over $10 million, just for the bidding (Campbell, 2012). The time period during the Games produces a net profit of only $100-$300 million through television rights, tourism, and ticket sales (Rosenblum, 2009). This profit barely covers the costs associated with operating costs. Therefore, the financial impact following the games often produces many misleading figures in regards to tourism revenue and infrastructure upgrades. The 2008 Beijing Olympic Games are historically the most expensive Olympic event costing an estimated $40 billion dollars (Rosenblum, 2009). Today, the Bird’s Nest, which was the main and most expensive Olympic Stadium built in Beijing, is currently being transformed into a shopping and entertainment complex. The initial cost of the stadium was $450 million and currently incurs an annual maintenance cost of $8.8 million (Rosenblum, 2009). In addition, the infrastructure upgrades rarely benefit the host city following the Games as they are typically designed to facilitate travel solely to the event itself. This is just one example of how important vigilant planning expertise for the Olympics infrastructure projects can be and how the costs of hosting can eventually outweigh the benefits. Lastly, the hosting of a mega event such as the Olympics can also have a significant impact on the environment. New environmental strategies are important for‘environmentally friendly approaches toward construction and event hosting activities, building energy efficient and renewables-powered accommodations and facilities, as well as implementing waste avoidance and water-use minimization measures (Collins, Jones, & Munday, 2009). The Sochi Games have recently been under scrutiny for the ecological footprint left behind from the building of infrastructure such as highways and railroads, as well as hotels and sport venues in their preparation for the games. Claims occurred that the Myzmta River Valley was deforested, toxic waste was dumped into the river, stone quarries were mined in reserve areas of Sochi National Park, and threats of avalanches and mudslides have appeared on the slopes of Aibga from construction of lifts and slopes. These effects have been responsible for diminishing populations of many species and impoverishment of biodiversity (Environment News Service, 2013). An altruistic vigilant approach to the well-being of those impacted by the Olympics provides a way to minimize irreversible costs.
The cost of hosting the Olympics continues to grow as cities around the world compete against one another with the hopes of economic expansion, advancement of infrastructure, and improvements for their image globally. The pursuit of hosting the games is a lengthy planning process that begins more than a decade from the scheduled games. Candidate hosts spend an estimated total of $90 million during the bidding process, much of which without the consent of the public (Campbell, 2012). In addition, the overall cost of hosting the games has skyrocketed from $2 billion for the 1996 Atlanta Olympic, $2.7 billion for 2002 for Salt Lake City Winter Olympics, and the bid estimate for the U.S. city of Boston to host the 2024 Games is estimated to cost $4.5 billion (Campbell, 2012). Findings confirm that host cities experience significant increases in economic expansion, employment, and wage increases as well as tourism. However, high costs associated with hosting the games and the upgrades to infrastructure generally exceed the profit margin acquired through television rights, ticket sales, and tourism. Furthermore, there is also a lack of altruistically vigilant research dedicated to the long term effects of hosting the Olympic Games to indicate much more than a short term stimulus. The Olympic Games effect on the environment can be both positive and negative. Whether attending or hosting the Olympic Games, an altruistic approach with vigilance toward the care and concern for the improvement of well-being in the host city helps promote stimulus for innovative global improvements by planning and thinking for both short and long term decision implications.
Campbell, J. (2012, September 25). Cost to Host the Olympics Skyrockets. Retrieved from ABC NEWS: http://abcnews.go.com/US/story?id=95650&page=2
Collins, A., Jones, C., & Munday, M. (2009). Assessing the Environmental Impacts of Mega Sporting Events: Two Options? Tourism Management, 828-837.
Environment News Service. (2013, February 11). Dark Side of the Sochi Winter Olympics: Environmental Damage. Retrieved from Environment News Service: http://ens-newswire.com/2013/02/11/dark-side-of-the-sochi-winter-olympics-environmental-damage/
Kirkup, N., & Major, B. (2006). Doctoral Foundation Paper: The Reliability of Economic Impact Studies of the Olympic Games: A Post Games Study of Sydney and Considerations for London 2012. Journal of Sports & Tourism, 275-296.
Rosenblum, S. (2009, April 4). The Impact of the Summer Olympics on its Host City: The Costs Outweigh the Tangibile Benefits. Retrieved from Digital Commons: http://digitalcommons.bryant.edu/cgi/viewcontent.cgi?article=1004&context=honors_history
Sun, Q., & Audwish, P. (2012). Country Branding Through the Olympic Games. The Journal of Brand Management, 641-654.