[Tinordi]

Originally Posted by polak

Would you be against the city losing $300 million dollar on the Olympics if that's all it cost them to get everything else built and the jobs it would create and the short term boost for small businesses?

A project is not good or bad depending on how many jobs it may generate. Its public worth depends on the value of the infrastructure or service the project provides and the costs that must be incurred for it. The employment impacts may offer some benefit, but that will depend on the nature, duration and location of the jobs; the potential supply of workers with the requisite skills; and the ‘incremental’ income the jobs offer relative to what those hired could otherwise do. It is a complicated issue – one that economic impact studies seldom address.

There is no greater frustration for economists engaged in public policy analysis than the use and abuse of economic impact analyses to justify major public and private projects. That the big numbers the analyses generate are wrong and in any event largely irrelevant to the issue of whether a project is in the broad public interest is somehow lost.

The 2010 Games have clearly left a legacy of facilities and infrastructure. And for some the contribution to community spirit, sports and culture offered great value in itself. But the Games also entailed a very significant opportunity cost. The issue is whether the financial and other resources dedicated to the Games were put to their highest priority use.

Government resources are limited and public needs are great. The Games didn’t pay for themselves in any meaningful sense and they weren’t justified by the jobs they were said to create. Whether the allocation of in excess of $6 billion for the Games and related infrastructure was justified was never properly addressed. However, that is the economic question that should have been asked and debated, and is what other jurisdictions would do well to consider before they bid on future Olympics or other mega-sporting events.

- See more at: http://www.policynote.ca/looking-bac....LsHwsHOD.dpuf

http://www.policynote.ca/looking-bac...-winter-games/