Research reveals Olympic games consistently exceed budgets by over 100%, challenging economic viability of hosting mega-sporting events.
Budget Overruns in Olympic Games
According to the Oxford Olympics Study, decisions to organize major sporting events often defy economic logic. The research analyzed games held between 1960-2016 and found that all exceeded their original budgets.
The scale of these overruns was substantial: in real terms, summer games exceeded budgets by an average of 176% (median 83%), while winter games exceeded by 142% (median 118%).
Comparison with Other Infrastructure Projects
When compared to other large-scale infrastructure projects, Olympic games showed significantly higher cost underestimation. The authors compared the Olympic data with projects in road, bridge, railway, dam, and IT development.
In transport infrastructure, budget overruns averaged 20-45%, with IT projects showing the highest at 107%. However, none of these traditional infrastructure projects approached the massive budget overruns characteristic of Olympic games.
