Slide1: Setting the Bar: A review of the developmental role of the Olympics Tracy Kornblatt Centre for Cities at ippr 22 January 2007


About the Centre : About the Centre Economic focus: not enough research on the economics of urban regeneration – we aim to fill this knowledge gap Comparative context: using lessons and sharing best practises from the U.S., Canada, and Europe Inform, connect: feedback our findings to local officials, Whitehall, private sector stakeholders. Convene together and further the dialogue.


Outline: Outline Why am I here? Background behind the Games as economic development catalysts Framework for thinking about the impacts London 2012 Questions for discussion


Background – Games as Economic Development Catalysts: Background – Games as Economic Development Catalysts Games are growing in bid popularity Since 1984, steady increase in the number of bids, the cost involved, and the profile of cities bidding Common theme of ‘economic development’ Bidding cities operating under an “unquestioned assumption that the Games will bring economic and social benefits to those who host them” (Burstyn, 2000). But the evidence is mixed


Although most people are familiar with the ‘Barcelona effect,’ there are other important host stories: Although most people are familiar with the ‘Barcelona effect,’ there are other important host stories 1960: Rome First ‘big’ Games: airport, roads, street lighting 1972: Munich Public debt; negative image, infrastructure 1976: Montreal Serious public debt: finally paid off in 2006 1984: Los Angeles Landmark profit, little infrastructure


Slide7: 1992 Barcelona Large-scale public investment; put on the map 1996 Atlanta ‘Coca-cola Games’, temporary venues 2000 Sydney Image success, development disappointment 2004 Athens Early to tell, but some image issues


Difficulties assessing the impact of the Games: Difficulties assessing the impact of the Games Infrequent, unique – attempting different things International contexts Most reporting is ‘official’ Counterfactual is difficult to assess ‘Soft’ impacts that are difficult to quantify


Key impacts the Games can have on economic development: Key impacts the Games can have on economic development Short term economic stimulus Infrastructure Political cohesion Social impacts Image impacts


Short-term economic stimulus: Short-term economic stimulus


Slide11: Source: Preuss, 1978 in Preuss 1998 Employment schematic


Employment continued…: Employment continued… Most employment is in the construction and hospitality/services sectors Most jobs are short-term, some entry-level Very different depending on the level of secondary infrastructure Consider where the investment is coming from – public/private? Areas where longer-term benefits can accrue: Expansion in tourism and construction sectors ‘Alien industry’


Infrastructure: Infrastructure The ideal is to pull-forward investment that matches with post-Games demand This can be a substantial benefit, but also risky Minimise investment in Games-only structures Temporary venues Use of dedicated roads and busses


Example: Barcelona: Unique context: decades of under-investment in urban infrastructure Had an existing GMP plan (1976) of investments they wanted to make Used the Games to pull forward large-scale infrastructure projects: Ring road, new city centre roads, traffic management system, airport expansion, telecommunications facilities, waterfront redevelopment, housing, renewal of parks and squares all over the city Example: Barcelona


Political cohesion: Political cohesion Sudden, unique pressure from the Games has an impact on the way political agents work with each other and the community Can unite, or divide, and have lasting impacts Political red tape on projects is often averted – which can be a good or bad thing Political leaders become a part of the image of the Games


Social Impacts: Social Impacts The Games have had the power to uproot, unite, improve, and destroy neighbourhoods in the host city Often efforts to hide ‘blemishes’ Enhancing civic pride – both locally and nationally – Atkinson et al 2006 Health/sport impact?


Slide19: Example: Atlanta Political cohesion: already racially-charge politics became even more polarised Politicians were seen to be working more with the business community and not enough with residents Social impacts: low-income housing decreased – displacement impacts While upper-income neighbourhoods were able to successfully move a venue out of their community, lower income neighbourhoods were unable to do the same


Image impacts: Image impacts The Olympics attract larger television audiences than anything else except “unscheduled accidents” (Tomlinson, 2000) Image carries great risk and reward possibilities Smaller cities may have more to gain, more prominent cities may have more to risk Business investment gains, tourism gains – but not always


Slide22: Sydney Put Sydney – and Australia -- on the map Particular investment in image: worldwide ad campaigns, time with media Increase in convention bookings and tourism (actual impact is difficult to estimate with Sept. 11 impact) (Chalip, 2002) Increase in international businesses opening an office in Sydney Low US viewership


London 2012: London 2012 Source: BBC


Slide24: Source: London2012.com


London 2012: London 2012 London 2012 Games coordinated with the Lower Lea Valley redevelopment 4 of London’s most deprived boroughs: Hackney, Tower Hamlets, Waltham Forest, and Newham Costs: £2bn operating costs; £3.3bn in infrastructure Employment impact: (2005-2016): 8,000 jobs NE London, 39,000 Greater London, 8,000 jobs UK (Blake 2005)


Promoted benefits: Promoted benefits London 2012 predicts impacts (UK-wide): in business, tourism, culture, volunteering, sport Additional London benefits: local employment?, boost to Lower Lea Valley Regeneration, housing, athletic facilities, public park, transport improvements, long-term employment Each Regional Development Agency has been working on strategies to capitalise on Olympic impacts


Setting the Bar: Lessons for London: Setting the Bar: Lessons for London Keep expectations, pressures reasonable Jobs will be mostly in greater London, but maybe not so local Benefits of the Games will be mostly in greater London Soft benefits – civic pride, social impacts should not be overlooked Costs should be updated and clarified


Closing Thoughts: Closing Thoughts Although perceived as a development dream, the Games are risky and the impacts are not clear-cut Difficult to compare – evidence base is thin Many studies on impacts are not reliable A broader range of impacts needs consideration There are benefits, but it’s not a windfall, so host cities have to match investments with post-games priorities, manage risk, and think carefully before bidding


Questions for Discussion: Questions for Discussion Are cities bidding for economic development reasons, or political reasons. Or something else? Are the Games worth the risks? For what cities might bidding be best? Have the Games become too big? What now? What more can London/the UK do to maximise the benefits of the Games?


Slide30: questions/comments? t.kornblatt@ippr.org www.ippr.org/centreforcities