Limited functionality available
Tokyo 2020 is providing Australians with a much needed lift, particularly given how well we tend to stack up in Olympic events.
Australia has been punching above its weight on this front for some time, and certainly since the success at the Sydney Olympics, where investments in Australian sport beginning in the 1980s finally delivered results. Overall, Australian athletes have taken home more than two-and-a-half times the number of gold medals from Sydney (2000) to Rio (2016) than in the games between Montreal (1976) and Atlanta (1996).
On a population weighted basis, Australia’s gold medal performance is significant. But population levels are not necessarily a good predictor of gold medal performance. More important is money. Other things equal, rich nations will have relatively more people with the ‘leisure’ time to pursue sport at an elite level, and the resources to support them.
Australia’s GDP or ‘cost’ per gold medal sits comparatively low compared to larger nations, based on the team’s performance in Rio.
Chart 1: GDP per gold medal, Rio 2016
However, Rio was not a particular high point for Australia in this regard, and neither was London. Historically Australia has performed better on this measure of ‘cost’ per gold medal, as the chart below suggests.
Chart 2: GDP per gold medal over time - Australia
Over the years, our success at the Games has in part been a function of the resources provided to support it. The agenda to focus economic resources and investment into the Games leading up to the Sydney Olympics paid off, with a tailwind that left us well placed for Athens and Beijing. Yet more recently, it appears that some of the momentum has fallen away.
Where Australia has had success has generally been in the areas where we have a comparative advantage, and this has been on display so far in Tokyo. Our coastal lifestyle has supported an advantage in water sports, with a significant number of gold medals since 2008 coming from swimming, rowing and sailing.
This is not just a function of the talent of our athletes. Broader support is important, and our success is bolstered by resources. Large national investments into infrastructure and facilities like Olympic pools in suburban areas since the 1940s and 50s have driven high-performance swimming in Australia. What this shows is that, like most business decisions, you gain the strongest return when you focus on what you do best.
With Brisbane confirmed to host the 2032 Olympics, the focus may come back round to how Australia can use its home ground advantage. And with winning the Olympic Games bid positioning Brisbane as both a tourism and sporting hub, there is the potential for economic benefits to slipstream our sporting performance.
David is a macro economist with extensive experience in applied economic and quantitative analysis of the Australian economy, along with considerable experience in labor market analysis. David is a regular commentator on macroeconomic trends, and prepares a weekly economic briefing newsletter.
Victoria recently joined Deloitte Access Economics’ Macroeconomic Policy & Forecasting team as an Analyst. She focuses on economic analysis and modelling across a range of areas including the labour market, aged care and health. Prior to this role, she has consulted on public policy and completed a Bachelor of Commerce with honours In Economics from the University of Sydney.