Beware Olympic Gold Medals: They Can Depress the Stock Market

Jan 22, 2018

Economists have long suspected that the Olympics can induce a feel-good effect that results in an economic boost. But a new study suggests there’s something else going on, as well.

Yes, people purchase items from sponsor companies, and that creates revenue. But it appears that, in addition to the feel-good effect, the Olympics, particularly gold medals, have a distracting effect that can actually lower trade volumes on the stock market the following day. The strength of the distraction effect varies from sport to sport, and country to country. It’s particularly strong in the U.S. Go figure.