Assessing the Infrastructure Impact of Mega-Events in Emerging Economies

Mega-events such as the Olympics or the World Cup are associated with large infrastructure investments and promises of high economic returns. However, the evidence from host economies shows that these sports events typically bring high costs with low rewards, as Victor A. Matheson notes in this paper. For the London 2012 Summer Games, a fifth of the total budgeted cost for the new Wembley Soccer Stadium was for infrastructure improvements, including new roads and a renovated transit station to accommodate Olympic traffic. Mega-event facilities may even serve one event’s single purpose and not be suitable for other regular events. For the Beijing 2008 Summer Games, the National Aquatic Center, or “Water Cube,” opened for public swimming after the Olympics and was later transformed into a large and extraordinarily expensive water park. Some cities have reused sports infrastructure by modifying them to serve universities or professional teams. Nonetheless, the high costs of these short-term mega-events raise questions of economic feasibility for host cities in developing countries.

This paper was presented at the Lincoln Institute’s annual Land Policy Conference in 2012 and is Chapter 8 of the book Infrastructure and Land Policies.