Large international sporting events such as the Olympics capture the attention of both the countries competing and those not competing in these events. This interest leads to huge revenues being generated by the relevant sporting federations through television contracts, ticket sales and ancillary of income.

Industrially developed countries have normally been the ones awarded the privilege of hosting these showcase events. However in the last three decades, international sporting federations have started to select developing countries or regions as sites for their events. These are often attempts to appease those countries or regions that feel that they don’t get a chance to benefit financially from being a part of these sporting federations. Add the fact that these developing countries or regions often produce some of the world’s best athletes so appeasing them could create the goodwill that will be needed politically in the future. Sporting federations believe that if they can help these nations provide better specialized facilities, then those nations will continue to develop new talent for their respective sports.

Although hosting international sporting events might have some benefits to developing countries, the expense of developing the specialized infrastructure needed will become too much for those societies to bear. The resources that would be potentially used for these events could be used to alleviate current social problems in these societies. It is also not clear if the short term or long term benefits of these events will be large enough to cover the direct costs created by these events. Hosting the Olympics and the respective World Cups brings initial significant costs and only potentially large benefits. Stay tuned as next week I explore the actual costs of these events for a country or region