OK, Sochi ended a couple months ago, and the pricetag we keep hearing is $51 billion (US) for the 2014 Olympic Winter Games. Now keep in mind that it is very difficult to sort out what part of that is for operating costs, and what is for infrastructure costs. In the case of Sochi, Russia basically built two towns from scratch – Adler and Krasnaya Polyana – along with the road between the two. But still, $51 billion is what everyone sees.
So how expensive was this when one looks at all the Olympic Games? Not easy to compare them over the years, because so many things change. But let’s try. First of all, we’ll use the standard numbers that are out there, often from the Official Results, for the nominal contemporary costs in US dollars. We’ll then correct these for inflation against the US dollar. Economists tell us this is not a perfect correction, and that it is better to use something called purchasing power parity (PPP), but those numbers for the inflated rates of PPP in each nation are not available going back to 1924 (or 1896 for the summer). So we’ll use historical inflation against the dollar, using the 2000 US dollar as the benchmark figure.
Now the Games also get bigger over the years so we should look at how much they cost relative to the size of the Games, using 2000 US dollars. The best numbers to use to look at the size of an Olympics are the number of athletes and the number of sports. The reason for this is obvious in terms of the numbers of athletes – more means larger Olympic Village(s), more means more security (in this era), and more means more transport issues getting those athletes around all the venues. Sports are also important because when you add a new sport, or discipline by the IOC definitions, you often need to add a new venue or stadium to host the sport, which is not inexpensive.
So here are the absolute numbers and the numbers corrected against inflation.
[table]
Year,Cost,Value (2000$),ConstantCost
1924,$3.83,9.736,$392.87
1928,$3.83,9.576,$399.427
1932,$30.60,10.958,$2792.58
1936,$19.13,12.162,$1572.48
1948,$5.10,7.472,$682.59
1952,$24.23,6.400,$3784.99
1956,$79.05,6.213,$12724.07
1960,$184.88,5.724,$32299.16
1964,$49.73,5.446,$9129.79
1968,$2422.50,4.988,$485654.20
1972,$4207.50,4.112,$1023253.29
1976,$240.98,3.098,$77782.69
1980,$475.58,2.296,$207144.16
1984,$414.38,1.673,$247641.15
1988,$1402.50,1.467,$956115.02
1992,$3570.00,1.224,$2916055.79
1994,$1657.50,1.154,$1436334.52
1998,$18615.00,1.038,$17927446.57
2002,$1912.50,0.939,$2036845.33
2006,$2677.50,0.848,$3155778.11
2010,$6375.00,0.771,$8268119.82
2014,$51000.00,0.699,$72983051.74
[/table]
Above, cost is listed in millions of US$ while constant cost is listed in thousands of US$.
So even corrected against inflation, Sochi is by far the most expensive Winter Olympics ever. In fact, as we’ll show later, it was more expensive, in constant dollars, than all previous Winter Olympics.
What about if we compare using constant dollars against number of athletes? And we’ll also use constant dollars against a new figure – number of athletes x number of sports – to take into effect both factors that tend to increase the size of cost of Olympics.
[table]
Year,CC,Ath,Spts,CC/A,CC/A-S
1924,$392.87,292,9,$1345,$149
1928,$399.42,461,8,$866,$108
1932,$2792.58,252,7,$11082,$1583
1936,$1572.48,668,8,$2354,$294
1948,$682.59,668,9,$1022,$114
1952,$3784.99,694,8,$5454,$682
1956,$12724.07,821,8,$15498,$1937
1960,$32299.16,665,8,$48570,$6071
1964,$9129.79,1094,10,$8345,$835
1968,$485654.20,1160,10,$418667,$41867
1972,$1023253.29,1008,10,$1015132,$101513
1976,$77782.69,1129,10,$68895,$6890
1980,$207144.16,1072,10,$193231,$19323
1984,$247641.15,1273,10,$194534,$19453
1988,$956115.02,1424,10,$671429,$67143
1992,$2916055.79,1801,12,$1619131,$134928
1994,$1436334.52,1738,12,$826430,$68869
1998,$17927446.57,2180,14,$8223599,$587400
2002,$2036845.33,2402,15,$847979,$56532
2006,$3155778.11,2494,15,$1265348,$84357
2010,$8268119.82,2536,15,$3260300,$217353
2014,$72983051.74,2749,15,$26548946,$1769930
[/table]
CC=constant costs (thousand US$); CC/A=constant costs/athlete; CC/A-S=constant costs/athlete-sport.
Once again, Sochi was more expensive in terms of constant cost per athlete and constant cost per athlete-sport than all previous Winter Olympics combined. It is interesting that 3 other Winter Olympics were also very expensive relatively speaking – 1968 Grenoble, 1972 Sapporo, and 1998 Nagano. Grenoble, Sapporo and Nagano were similar to Sochi in terms of huge amounts of infrastructural costs to host those Winter Olympics.
This can be understood better if you compare each Winter Olympics to the combined costs of all previous Winter Olympics. Here are those numbers.
[table]
Year,CAPCC,CAPC/A-S,Notes
1924,—,—,
1928,1.017,0.724,
1932,3.525,6.141,>previous
1936,0.439,0.160,
1948,0.132,0.053,
1952,0.648,0.303,
1956,1.322,0.661,
1960,1.445,1.247,>previous
1964,0.167,0.076,
1968,7.615,3.556,>previous
1972,1.862,1.892,>previous
1976,0.049,0.044,
1980,0.126,0.119,
1984,0.133,0.107,
1988,0.454,0.334,
1992,0.953,0.504,
1994,0.240,0.171,
1998,2.418,1.245,>previous
2002,0.080,0.053,
2006,0.115,0.076,
2010,0.271,0.181,
2014,1.881,1.249,>previous
[/table]
CAPCC=compare all previous constant costs; CAPCC/A-S=compare all previous constant costs/athlete-sport.
This may not seem obvious so let’s look at it. In 1928, St. Moritz was 1.017 more expensive than all previous Winter Olympics, which was only 1924 Chamonix, in terms of constant costs. But it was actually cheaper than 1924 in terms constant costs/athlete-sport, at only 0.724 times the Chamonix CC/A-S.
For Lake Placid in 1932, it was 3.525 times more expensive than Chamonix (1924) and St. Moritz (1928) in terms of constant costs, and 6.141 times more expensive in terms of constant costs/athlete-sport. When a Winter Olympics is more expensive on both parameters, I have used the note “>previous”.
It turns out that 6 times a Winter Olympics has been more expensive on both parameters or “>previous”. This occurred at the following Winter Olympics:
[table]
Year,CAPCC,CAPC/A-S
1932,3.525,6.141
1960,1.445,1.247
1968,7.615,3.556
1972,1.862,1.892
1998,2.418,1.245
2014,1.881,1.249
[/table]
So these are the 6 spendthrift Winter Olympic hosts. Looking at the causes, 1932 Lake Placid was expensive because they had to build both a bobsled run and ski jumps, and because Chamonix and St. Moritz were so inexpensive. Squaw Valley in 1960 was expensive because, like Sochi with Adler and Krasnaya Polyana, that resort was built almost from scratch – although they did skip building a bob run.
Sapporo in 1972, Nagano in 1998, and Sochi in 2014 were all expensive because of huge infrastructural costs, but the interesting thing here is that Sochi does not look so bad, comparing at about the same rate of Games inflation as 1972 and 1998.
Grenoble in 1968 was really an industrial city, despite its location in the Alps, and most of the sports venues and resort had to be specially built for the Games, including a stadium that was used only for the Opening Ceremony. The citizens in the area would be paying for the costs through 1995, and Grenoble in 1968 should be considered the most expensive Winter Olympics ever, relative to previous Winter Olympics. Compared to Grenoble in 1968, Sochi looks positively a bargain.