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The Olympics: Did Tourists Help China's Economy?

Not one, not two, but three different Olympic Games are in the news today. In California, a Sacramento group has announced a bid to bring the 2022 Winter Games to Lake Tahoe. Meanwhile, south of the equator, the government of Rio de Janeiro has launched an international contest to choose who will build its Olympic Park for the 2016 Summer Games. Most importantly, though, today is the final day for fans to purchase tickets to the 2012 Summer Games in London. Organizers claim that there has been high demand for tickets in the final days, and Sebastien Coe, the head of the organizing committee, has predicted one million extra visitors to London because of the Games. Coe, of course, is required to be optimistic about tourism numbers, but just how optimistic is he?

Earlier this month, in the Tourism Economics journal, Shina Li, Adam Blake, and Chris Cooper revisited their previous study of tourism during the Beijing Olympics. In their original study, conducted prior to the games using historical data, the authors predicted that increased international tourism would have a positive effect on the Chinese economy, particularly by injecting money into service industries. When the authors revisited the question after the Olympics, this time using post-Olympics data from China's National Tourism Administration, they found that tourism did not increase during the games, negatively impacting the economy. Those hoping the Olympics would give the British economy a shot in the arm might want to start looking elsewhere.