The True Cost of Glory: What Economics Teaches Us About the Winter Olympics

February 19, 2026

As Norway celebrates its 15th gold medal and Italy rallies behind its home team’s nine golds at the Milan-Cortina 2026 Winter Olympics, there’s so much more happening on the ice than athletic glory. These Games offer a masterclass in three fundamental economic concepts: opportunity cost and comparative advantage, the true economics of hosting mega-events, and how public goods create lasting spillover effects. 

Why Brazil Has a Bobsledder (But Not a Biathlete) 

This year’s most exciting underdog story? Brazil just won its first-ever Winter Olympic medal—and it was gold. How does a tropical nation with no natural ice compete at the Winter Games? The answer lies in the economic concept of comparative advantage. 

Brazil didn’t attempt the impossible—building a cross-country skiing program without snow, mountains, or a winter sports tradition. Instead, they leveraged what they already had: explosive speed and power from their track and field athletes. Bobsled became the perfect fit—a sport where tropical nations can compete because much of the training happens on wheeled sleds on regular tracks, no snow required. 

Compare this to Norway’s approach. With 33 total medals at these Games, Norway invests heavily in Nordic skiing—sports like cross-country and biathlon where their snowy landscape, existing facilities, and cultural tradition create natural advantages. 

This difference reveals two important economic concepts at work. Comparative advantage explains why each country specializes: Brazil succeeds by focusing on sports that match their existing athletic strengths, while Norway doubles down on winter disciplines where geography and infrastructure give them an edge. 

Opportunity cost explains what each country gives up. When Brazil invests in bobsled training, they’re choosing not to spend those same resources elsewhere. Norway could fund a beach volleyball program, but that money produces far better results when invested in sports where they already excel. For Brazil, choosing not to pursue bobsled would mean sacrificing their best—perhaps only—realistic path to Winter Olympic medals. 

As you can see, even athletes face these calculations. Olympic hopefuls sacrifice years of potential earnings and education, betting on an uncertain payoff. That calculation looks different in places like Norway, China, and Russia, where state funding supports athletes, versus nations where athletes mostly self-fund their Olympic dreams like the United States. These contrasting approaches to Olympic funding mirror broader economic philosophies: the U.S. model reflects a market-based economy where private competition allocates resources, while China and Norway’s state-sponsored systems exemplify how command and mixed economies use centralized planning to achieve national goals. 

The Host City Gamble: When Winning the Bid Means Losing Money 

Milan-Cortina’s operating budget sits at €1.7 billion, with infrastructure investments reaching €3.5 billion. Organizers promise a €5 billion economic boost and 2 million visitors. But Olympic history suggests we should be skeptical. 

The economics of hosting have gotten so problematic that fewer cities even want to bid anymore. Sochi 2014 cost $51 billion. PyeongChang 2018 spent $13 billion and now operates costly venues with limited use. Milan-Cortina tried to avoid this trap by reusing 85% of existing venues—a smart strategy that helped them win the 2019 bid over Stockholm. 

But here’s the catch: even with cost-cutting measures, most revenue flows to the International Olympic Committee (IOC), not host cities. Ticket sales, broadcasting rights, and merchandising largely benefit the IOC, while taxpayers foot the infrastructure bill. The temporary tourism spike rarely offsets decades of potential debt repayment. 

The Spillover Effects: Infrastructure’s Hidden Value 

Before we write off Olympic hosting entirely, though, consider this: some of that infrastructure spending creates lasting benefits that reach far beyond the athletes. 

Unlike private goods, infrastructure improvements are non-rivalrous (multiple users benefit) and non-excludable (you can’t prevent locals from using improved roads). The highway upgrades and airport expansions built for the Olympics serve Italian residents long after the closing ceremony. Milan’s upgraded transit systems and Cortina’s renovated facilities create positive externalities—benefits that extend beyond the Games themselves. 

Some returns are harder to quantify. Right now, hundreds of millions of people worldwide are watching Italy showcase its culture, landscapes, and hospitality. Somewhere, a 13-year-old is watching Mikaela Shiffrin and begging their parents for ski lessons. Cities across Italy are experiencing something rare: genuine civic pride and shared purpose. These benefits won’t appear in any budget report, but they’re nonetheless real. 

However, we must also account for negative externalities. The environmental impact of artificial snowmaking, the displacement of residents for Olympic construction, and the opportunity cost of what else €3.5 billion could have funded—schools, hospitals, renewable energy—represent real social costs. 

The Final Tally 

As the Games continue through February 22, the medal count tells only part of the economic story. Norway’s dominance reflects decades of strategic investment in winter sports infrastructure. Brazil’s historic gold demonstrates the power of identifying comparative advantage. Milan-Cortina’s strategy of reusing 85% of existing venues offers a potential blueprint for future hosts—assuming it actually works. 

So what’s the lesson here? Economics isn’t just about dollars and cents—it’s about choices, trade-offs, and the often-hidden costs of pursuing glory. Whether you’re an athlete deciding how much to sacrifice, a nation choosing which sports to fund, or a city considering an Olympic bid, understanding opportunity cost, comparative advantage, and public goods helps explain why some gambles pay off while others don’t. 

Amanda Stiglbauer is the Economic Education Curriculum Fellow at the Foundation for Teaching Economics, where she leads instruction in both student and teacher programs. She is also an Economics & Business Course Developer and Facilitator for UC Scout. An award winning educator and AP Microeconomics Question Leader, she brings deep classroom experience to teachers and students nationwide.