Home > Website archive > News and media > News archives > 2016 > 08 > The Olympics made us happy, but was it worth it?

The Olympics made us happy, but was it worth it?


The 2012 Olympic Games caused a marked increase in happiness among Londoners, according to new LSE research which shows for the first time that there are significant intangible effects to hosting the event.

As the 28th summer Games open in Rio de Janeiro this week, the $4.1bn bill will be relatively modest compared to the $15bn spent in London. However, with Brazil heading into a deep recession, public support for the event has fallen, with a recent poll showing that 50 per cent of Brazilians think the money could be better spent elsewhere.

Most academic studies have found little evidence of any tangible long-term economic impact, with the most recent concluding that in most cases the Olympics are a money-losing proposition for host cities.

With this in mind, LSE researchers set out to study the nature and extent of the “intangible” impact of the Olympic Games by using measures of subjective wellbeing that have been developed and tested by economists and psychologists for around 20 years in order to assess how people think and feel about their lives.

Their report explains: “Many proponents of the Games now suggest that one of its main contributions is the intangible impact on the people who host them. The UK government’s assessment of the 2012 Summer Olympics in London focused on intangibles such as ‘inspiring a generation of children and young people,’ community engagement, and enthusiasm for volunteering.

"There is also evidence that citizens are willing to pay substantial sums to host these events. A national opinion poll conducted immediately after the 2012 Olympics found that 55 per cent of respondents believed that the public expenditure of the Games had been well worth the investment. Arguably, an important part of the value of public expenditure is the legacy effect, i.e. the long-term benefits of the Olympics.”

Researchers led by Paul Dolan, Professor of Behavioural Science at LSE, compared levels of happiness in London, Paris and Berlin, interviewing 26,000 residents over three years from 2011 to 2013. They found that Londoners were significantly happier during the Games compared to Parisians and Berliners, but that levels of happiness returned to normal the following year. The opening and closing ceremonies, the two most watched and most expensive events in terms of ticket prices, had the most marked effects on levels of happiness.

The report, The Host with the Most? The Effects of the Olympic Games on Happiness, charts how, until the 1960s, the Olympics were relatively modest affairs with limited finance and investment. The television era of watching sport, combined with the capacity to reach a global audience enhanced the prestige of the event and encouraged fierce competition amongst cities to host the Games, resulting in a significant rise in expenditure on staging them. The 1956 Summer Olympics in Melbourne cost approximately $63 million in 2016 prices. In contrast, the 2012 summer Olympics in London required government subsides of $15 billion alone to cover the direct costs.

It concludes: “Overall, many cities spend substantial resources attracting and then hosting the Olympic Games, but the evidence to date suggests that the Olympics do not have a significant economic benefit to the host city. This paper presents the first causal evidence of a positive wellbeing effect of the Olympic Games on local residents during the hosting of the Games. The effects do not last very long, however, and the Games show no effect on subjective wellbeing a year later. The host with the most. But not for long.”

Professor Dolan commented: “The London Olympics was a great spectacle which had a sizeable but short-lived effect on happiness."

For more information

Jo Bale, LSE media relations office, 07831 609679 or j.m.bale@lse.ac.uk

Notes to editors

To read the report, please go to   http://cep.lse.ac.uk/pubs/download/dp1441.pdf   

It was published by the Centre for Economic Performance, an independent ESRC funded research centre based at the London School of Economics and Political Science. Its members are from LSE and a wide range of universities within the UK and around the world.

 4 August 2016