Question

what is the significance of modern olympic games in our era

Answer 1

Answer:

Economic benefits of the Olympics

1. Encourages investment in transport and infrastructure

Major sporting events usually require upgrades to transport and communication links. This investment leaves a lasting legacy for the whole economy. Better transport links reduce congestion and help to improve efficiency for local business. It can help increase the productive capacity of the economy (shifting aggregate supply to the right). For example, for the London Olympics in 2012, we have seen new rail links created in East London, and improvements to existing underground and overground train services (London Olympic rail networks)

2. Influx of foreign visitors

A major sporting event like the Olympics can attract thousands of people for the duration of the games. These foreign tourists bring a boost to the local economy. In particular the local tourist trade, shops/hotels will benefit from the surge in visitor numbers. However, it is worth noting that these visitor numbers tend to be temporary. The major sporting event only lasts for a few weeks; potentially there could be many empty hotel beds in the future. On the other hand, people argue a major sporting event can lead to a long-term growth in visitor numbers. e.g. China felt the Beijing Olympics created a feeling that China could be a popular tourist destination. Barcelona saw higher visitor numbers continue after the Barcelona Olympics of 1992.

3. Job creation

Typically, major sporting events require investment in building stadium and hotels. This creates jobs for the local economy for up to 4 years before the event. These extra jobs help create a positive multiplier effect within the local economy. It is hoped that the London Olympics will help regenerate the east end of London. Some argue this temporary job boost can prove more permanent if the economic regeneration continues after the games.

4. Higher economic growth

It is estimated that the ‘Olympics Effect’ leads to a boost in economic growth due to the higher investment and foreign visitors. This leads to higher tax revenues for the government