The spotlight on the Tokyo Olympics has again raised the debate of whether the enormous amounts spent to host them actually give a return to the host nation economy. Ford School professor Josh Hausman said the effect on a country's GDP can depend on many factors.
“While spending as a share of GDP will certainly be smaller when the Olympic games are held in a large economy versus in a smaller economy, it is hard to judge how large the overall economic impact of the Olympic games might be. There are many possible effects beyond direct spending. There is not only possible tourism for the games itself, but also future tourism that might be inspired by the television coverage of the games. There are also possible effects on consumer and business sentiment,” he says.