Olympics and World Cup are held after every four years, and many people worldwide spend many hours glued on television following these games. However, the economic impact of hosting such events is subject to debate among economists. There are those economists who perceive this as an excellent way to stimulate exponential economic growth. On the other hand, some economists affirm that such mega-events do not improve the economy and instead are detrimental to the country’s economic progress. Be that as it may, it is a privilege for any country to host such mega sports events. It is an inescapable fact that the World Cup and Olympics hosting rights has financial implications on the city and state. Therefore, this essay discusses the short-term and long-term impact of hosting these mega sports events.
Examine the short-term and long-term economic impact of hosting the Olympics or World Cup on a city/country.
Short-term economic impact
The short-term economic impact of hosting the Olympics or World Cup on the city or country leads to increased retailing, tourism, temporary employment, and accommodation. Many years are used in planning and investment, which is essential in job creation and goes a long way in revitalizing depressed cities. Besides, it may help spur economic development in the part of the town that is relatively depressed. Olympics and World Cup lead to a surge in the number of visitors in the city or country. The visitors include the athletes and their families, fans, and media personnel. That provides a perfect opportunity for enhanced expenditure and the injection of money into the local economy.
It should be noted that the injection of money in the local economy as a result of the World Cup and Olympics only happens on a short-term basis and has little influence on the overall economy of the country. It only has a meaningful impact on the local economy of the city. Additionally, the influx of foreign visitors in the various cities hosting the World Cup matches or Olympic Games may be detrimental to the locals who will instead move to rural areas and other cities to avoid overcrowding. However, some economists believe a positive short-term impact of these mega sports events on the town or country’s economy due to the increased demand for domestic tourism and retailing. World Cup and Olympics bring additional revenue in the form of government taxes. The matter is that these mega sports events trigger the exponential sale of sports wears and alcohol, which directly contributes to economic development. However, some economists argue that the short-term impact on the host countries is below the projected figures.
Long-term economic impact
Hosting World Cup and Olympics helps raise the country’s profile and city, which leads to long-lasting economic benefits. The cities that have hosted the World Cup or Olympics guarantee an increase in recognition and tourism all through. Cities like Sydney and Barcelona have earned recognition and are a favorite tourist destination since hosting the Olympic Games. The increased profile comes with many benefits, such as direct foreign business investment and tourist attraction. The services also depend on the particular city. Hosting these games has a tremendous impact on the international image of the country and the city. Enhanced perception of the country or the town promotes foreign direct investment and tourism in the long run. Those visitors who have outstanding experience in the country during the World Cup or Olympics are more likely to come back in the future. Besides, television viewers may find the country fascinating and opt to travel there when for a holiday. The countries that have questionable human rights records tend to gain international acceptance through hosting these significant games. Many long-term investments come with hosting the Olympics or World Cup. The city or country usually has a long-lasting legacy of modern sporting venues. Usually, the cities make massive investments in infrastructure and transport to cater to the high number of tourists during these games. All cities that have hosted the World Cup or Olympic games have witnessed significant investment in public transport projects, which have permanently changed these cities’ images. Major sporting events promote enthusiasm and excitement among the people. That may help encourage participation in sports, which has a lasting impact on the nation’s health. Additionally, major sporting events may lead to the rise in volunteerism that enhances civic virtues. It is a fact that hosting the World Cup is a branding process for the country that attracts tourists and capital.
Compare the social and economic impact of the Olympic Games on Barcelona and Sochi.
It is an inescapable fact that the 2014 Winter Olympic Games, held in Sochi in Russia, had an adverse social and economic impact on the city and the country. The total cost of hosting these games was fifty-five billion dollars, making the Sochi Winter Olympic games the second most expensive Olympic Games ever. The public-funded over ninety-six percent of these costs. However, despite the high costs incurred, extensive construction of hotels led to oversupply. There was widespread investor default of loan payment, and there were no coherent plans to put into use these venues and other large infrastructure projects after the Winter Olympic Games. Due to these failures, the Sochi Olympics continue to haunt Russia with high expenses for maintenance, operations, and foregone tax revenue and interest, which is estimates at over one billion dollars annually. These Sochi Olympic Games also failed to improve the image of Russia in the world. It was public relations monumental disaster for the country. There were numerous unfinished hotel rooms in Sochi by the time the event was held. It was reported that packs of dogs roamed around the Olympic Village and one of the giant Olympic rings did not light during the opening ceremony. That dented the reputation of Russian technology in the world. On social influence, the Sochi Winter Olympic games were associated with homophobia stimulated by the Russian law that banned nontraditional sexual relations. The then Sochi’s mayor is on record asserting that the city did not have any gay residents. Moreover, there was a perceived threat of terrorist attacks, which made the games not live up to their expected level. Most Olympic venues and stadia are now white elephants.
The 1992 Olympic Games held in Barcelona in Spain remain one of the most successful significant games that transformed the city into what it is today. These 1992 Games helped to re-launch the town as a tourist destination. After hosting the 1992 Olympic Games, Barcelona rose to global stardom as the preferred Mediterranean tourist destination. The city is ranked the fifth most preferred tourist destination in Europe and twelfth in the world. Besides, economists use Barcelona as the reference whenever the city is preparing to host a mega-sports event. It is twenty-eight years since the city hosted the Summer Olympics, and the city continues to enjoy the fruits of these games. These games helped diversify Barcelona from over-reliant on Spanish tourists, and now most tourists come from other countries of the world. The city was able to solve abandoned venues and stadia through the support of the Spanish authorities and instead revolutionized the sports industry in the country. It led to the development of powerhouse sports programs. The country now boasts of many world-class footballers, cyclists, tennis superstars, and basketball stars, among many other stars from other sports. Spanish government ensured that all new stadiums and venues in the city are well maintained and utilized by the future generation of sportspeople.