Question

I need someone to distinguish between micro- and macroeconomic impacts of hosting the Olympic Games. Full sentences please. I need this answer ASAP. Thanks in advance.

Answer 1

Olympics are expected to have short and long term effects both on individual economic agents and firms on one side, analysed under the microeconomic aspect, and on the side of the economy as a whole, analysed under the macroeconomic aspect. The latter one are more evident and are supported by evidences. The country that hosts Olympics, must have a good infrastructure to organize them.

There is a boost to employment and income, local housing construction and an improvement in consumer confidence. Foreign capital inflow is another aspect as more firms are now willing to invest in host nation. If the country is able to win medals as well, this increases its GDP per capita as well, as the studies prove. All this implies, Olympics, on average, increases the GDP of the nation as a whole and for individuals as well. This relates to macroeconomic aspects of Olympics.

Individual firms find their sales increasing as more tourism is associated with Olympics. Local firms that belong to cities hosting the games suddenly experience a rise in revenue when locals as well as visitors purchase from local markets. Construction firms and firms associated with building of infrastructure are encouraged. Hence on the microeconomic front, there is a automatic surge in sales as well.

Hence, we see that the growth rate of hosting economies is expected to be higher than other similar countries.