With much of the cost of hosting an Olympics going into infrastructure that is expected to be used beyond the games, calculating the total cost of hosting an Olympics can be a matter of perspective. But if we look at just the sports-related cost, we can see that the cost of hosting the Rio Olympics will be much cheaper than London 2012 or Sochi 2014.
A study by Bent Flyvbjerg, Allison Stewart, Alexander Budzier for the Saïd Business School at the University of Oxford looked at the sports-related cost and cost overrun for most Olympic games since 1968. From 1968 through 2010, the games had an average sports-related cost of $3.6 billion (inflation-adjusted). Then, all of a sudden, things took off. The last two Olympiads had an average cost of $19.0 billion.
The sports-related cost of the Rio Olympics will be more in line with previous Olympiads, costing $4.5 billion. The overall cost is expected to reach $12 billion, according to the New York Times.
To make matters worse, not a single Olympic games hit their budget with an average cost overrun of 167% through the Sochi Olympics. Only Beijing 2008 (4%) and Vancouver 2010 (17%) had cost overruns of less than 29%. The cost of the Rio Olympics is expected to reach 51% when all is said and done.
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