Circus Maximus: The Economic Gamble Behind Hosting the Olympics and the World Cup
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The numbers are staggering: China spent $40 billion to host the 2008 Summer Olympic Games in Beijing and Russia spent $50 billion for the 2014 Sochi Winter Games. Brazil's total expenditures are thought to have been as much as $20 billion for the World Cup this summer and Qatar, which will be the site of the 2022 World Cup, is estimating that it will spend $200 billion. How did we get here? And is it worth it? Those are among the questions noted sports economist Andrew Zimbalist answers in Circus Maximus: The Economic Gamble Behind Hosting the Olympics and the World Cup. Both the Olympics and the World Cup are touted as major economic boons for the countries that host them, and the competition is fierce to win hosting rights. Developing countries especially see the events as a chance to stand in the world’s spotlight. Circus Maximus traces the path of the Olympic Games and the World Cup from noble sporting events to exhibits of excess. It exposes the hollowness of the claims made by their private industry boosters and government supporters, all illustrated through a series of case studies ripping open the experiences of Barcelona, Sochi, Rio, and London. Zimbalist finds no net economic gains for the countries that have played host to the Olympics or the World Cup. While the wealthy may profit, those in the middle and lower income brackets do not, and Zimbalist predicts more outbursts of political anger like that seen in Brazil surrounding the 2014 World Cup.
the economy. The owners and workers at these businesses earn additional income, a portion of which they spend on the services and products of still other businesses. The purpose of the input-output model in these studies is to generate a multiplier. The multiplier is supposed to tell us when a visitor buys a $100 meal at a restaurant and, as the $100 works its way through the rest of the economy, how much new output has been created. Depending on the model, the multipliers employed in these
ultimately used during the 1992 Olympics, twenty-seven were already built and another five were under construction at the time Spain was selected to host the games in 1986.2 Thus, a central feature of the Barcelona experience is that the plan preceded the games, and hence the games were put at the service of the preexisting plan, rather than the typical pattern of the city development plan being put at the service of the games.3 Several factors further contributed to the salutary role played by
too. The development plan included the removal of old industrial and residential areas. Barcelona's widely published and well-known architectural critic Josep Maria Montaner leveled the following criticism at the changes to the city's urban landscape: [There was a] mistreatment of heritage, especially the industrial heritage in Poblenou. To understand this, one must understand that the underlying characteristic of the Spanish tradition, from dictatorship to democracy, was one of
pattern familiar to mega-events, as land becomes scarcer and demand often rises. According to the Knight Frank Global House Price Index, the rate of increase in home prices in Brazil during 2012 was the third highest in the world. The rate of increase in Rio was even higher, jumping 58.3 percent (in real terms) between August 2010 and June 2013.29 Rio has a housing deficit estimated at 500,000 units. The shortage was aggravated by the widespread evictions of slum (favela) dwellers to improve the
In an interview with Brazil's Colectiva magazine, leading Brazilian journalist, television personality, and soccer commentator Juca Kfouri opined: I think that [hosting the Olympic Games] does not make any sense for a country that does even have a sports policy, as it has been admitted by the Minister of Sports. It is putting the cart before the horse. Sport should be handled as a factor of public health, disease prevention, following the dictates of the World Health Organization, which reveals