Why some Olympic Games have incurred in massive budget overruns?

Eduard

there is a comprehensive analysis of Olympic games by Bent Flyvberg (I do not agree with all of his conclusions though)
https://www.academia.edu/3271242/Olympic_P...mpics_1960_2012

and a nice graph showing final costs and overruns
https://howmuch.net/articles/olympic-costs

Well, I have looked in some detail into the Salt Lake City Games (which won a PMI PoY award) and the Socchi Games (which came in well under budget if you exclude the construction of venues and infrastructure).

Some perspectives:
- The overruns are coming down over the years, there is a clear trend.
- IOC has lessons learned and good practices but also the most monetary benefit from the games.
- Countries - especially if they are high on the corruption index - suffer from usual overruns in construction, but may be able to reuse the infrastructure built, if they still own it (one of the problems in Greece).
- And then, much value is indeed generated by 10s of 1000s of volunteers, not included in budgets.
- All Olympics start with relatively small seed money and elicit their funds over the program (one of the functions that helped SL city to win the PMI award). So this is not a simple budget approved in the beginning by government, but a work in progress with many question marks.
- Beijing games came in with the lowest overrun - what are the Chinese doing differently?

Thomas

The Olympics seem like an ideal set of conditions for huge overruns.

While they appear to be a big economic opportunity, most land the hosting cities in massive debt. They over-estimate the jobs and cash inflow, and they require additional infrastructure projects such as roads to support the large crowds. They seem more focused on prestige than economics.

They are inherently political and when political seats change hands, the new administration often wants to change the programs of the incumbents. Moving the planned location of roads, buildings, or even flipping floor plans can be extremely costly in major construction. A lot of engineering work is completely wasted.

Perhaps the lower overrun in China is due to having existing infrastructure. Perhaps it is "creative accounting". Their construction boom is seeing major structural faults with cities built despite a lack of occupants.