ABSTRACT
This chapter investigates the fiscal impacts of the Olympics in Rio. It seeks to answer two questions: (1) Did the Rio2016 Olympic Games disrupt the city’s public accounts? and (2) How were the fiscal costs financed and distributed between 2008 and 2016? During the preparation phase for the Olympic Games, fiscal rules and limits were honored by the City Hall, reducing the relative weight of public debt and payroll expenditure. It was a period of high government investments based on a successful financial management. On the negative side, the municipal public servants’ social security system faced challenges common to other Brazilian subnational governments. Investment grew 144.5% between 2010 and 2015 in Rio, while the same variable grew only 3.8% in São Paulo during the same period. However, it is worth noting that the weight of payroll expenditures is higher in Rio de Janeiro’s municipal budget than in São Paulo’s. Moreover, the assessment reveals that the Games were not responsible for the State of Rio’ financial collapse, announced just before the opening ceremony. In the midst of a structural crisis, the State of Rio faced serious difficulties in its revenue collection and had overwhelming expenses not related to the Games organization.
