Article

Sports Stadiums and Area Development: A Critical Review

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Abstract

Should local governments subsidize the construction and operation of sports stadiums? This is being debated in cities throughout North America, and several factors have conspired to elevate this issue to headline status. Local government officials, burdened by the deteriorating financial health of their cities, have sought ways to mollify critics. Since some political strategists have argued that the presence of professional sports imparts economic prosperity, some local political leaders have hitched their wagons to the sports star. But is professional sports a panacea for sagging urban economic fortunes? Many are skeptical that subsidizing sports stadiums is worth the costs. We examine published and unpublished literature as well as our own research to chronicle, analyze, and critique the use of publicly financed sports stadiums as a vehicle for economic progress. We provide information for both the academic and the practitioner on the types of questions that should be posed when making decisions about stadiums. In the first section we detail and analyze the recent history and future plans for city financial involvement in sports stadium projects. We discuss the costs and benefits of stadium-based development rationale in the second section, and the next section analyzes its validity. Factors that may prove decisive in determining the economic successfulness of an individual stadium project are observed in the fourth section, and the last section concludes the article.

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... The interested parties not only believed the stadium would draw residents throughout the metropolitan area but would also be a force for tourism. It is a classic example of an economic development device for recapturing traditionally urban activities that have been lost to suburban areas (Baade and Dye 1988). However, this assumption fails to recognize the historical development of Phoenix and the polycentric nature of the county and larger metropolitan area in which the stadium would be constructed. ...
... Again, this illustrates the fact that a greater proportion of Phoenix residents must come from farther distances from the stadium than do Denver residents. As recent studies have shown that suburban residents spend less time near stadiums after games (Baade and Dye 1988), this travel time component is critical for development projects seeking to increase shops and restaurants around the stadium. Thus, places with more suburban, dispersed populations, like Phoenix, are more likely to experience challenges attracting shops and restaurants to areas surrounding their stadiums because the customer base is simply not sufficient to maintain a profitable business. ...
... The size of the customer base is a measure of the potential visitor traffic to the stadium, which previous studies have suggested is a key component to the success of stadium development projects. Baade and Dye (1988) write: ...
Article
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Prior analyses of stadium-focused economic development efforts suggest these projects are multifaceted in scope and one-size-fits-all approaches are rarely successful. This study builds upon prior analyses of stadium development projects and provides a comparative analysis of two stadium projects in Denver and Phoenix, with a focus on the role urban form has on the opposing outcomes of the two projects. Results suggest urban form has an impact on the prospects for success of these projects and that strategies to deal with the urban form of a city should be incorporated into comprehensive plans to revitalize downtown areas. A consideration of urban form is particularly important for polycentric urban areas where the success of downtown economic redevelopment efforts remains largely unexplored and unproven.
... Underreporting the real cost increases the public cost by 40% across Long's sample and the gap has been widening in recent years. Baade and Dye (1988) test the prestige factor of getting an expansion or relocated franchise by comparing the changes in the city's manufacturing businesses. Their study looks at personal income over time. ...
... Franchise owners have the power to convince government officials to support their private goals. Baade and Dye (1988) argue that owners can enforce the threat of team relocation. Between 1970 and 1985, 22 sports franchises have moved, producing significant psychological, economic, and political costs to the affected cities. ...
Article
Proponents praise stadium projects as beacons of development, but this may not be true. Yet, ballparks and stadiums continue to be built, partly due to league monopoly and partly due to fan influence. This study will look at the relationship between fans and stadium financing proposals. This relationship will be tested using attendance, which is one measure of support for a given team. Wins and higher team quality encourage fans to attend games. Using two-stage least squares, a model is developed to see how these factors influence the stadium financing approval process. The first stage develops a forecasted attendance model, which is applied to stadium vote results for analysis on stadium finance projects. Results supporting the hypothesis would suggest a clear way for teams to be successful for these initiatives. The results suggest that success on the field helps in the process, but is not required. Several critical public policy conclusions are drawn from these results.
... Modern economic development strategies are varied. Among others, they include issuance of industrial development revenue bonds and tax increment financing districts intended to foster business growth (Rubin & Rubin, 1987) 2 , major public works projects (Kline & Moretti, 2013), investment in workforce development, and the construction of local sports arenas and Olympic Games parks (Baade & Dye, 1988;Kontokosta, 2012). These investments promise to create jobs and enhance the tax base. ...
... In addition to missing potential fiscal benefits for the locality, local economic development strategies may not create the jobs they promise. Baade and Dye (1988), for example, argued that the expectation of positive outcomes as a result of investment in a sports complex (in isolation) is a concept "made of hay" (p. 274). ...
Technical Report
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The purpose of this report was to become familiar with the concept and examples of its implementation in the United States. The authors embarked on identifying a basic framework for how a regional economic development program could be implemented in the Roanoke and New River valleys and beyond. Actions recommended in the report are based on a rigorous analysis of best practices that we learned about through interviews with regional economic developers from various regions in the United States. In particular, we analyzed how well a particular regional strategy might address goals that benefit not just a local area but an entire region. A substantive section of this research—the Community Asset Inventory—provides a tailored account of the various resources that exist in our region. This section begins with the identification of our region based on industrial strengths. Regional identification was formed on the basis of stakeholder identification as well as quantitative cluster analysis to measure the importance of certain industries to the region (in terms of employment).
... In recent years, many owners of major league sports teams have received local government subsidies ranging into hundreds of millions of dollars for their promise to stay in their host towns. Some have received similar sums to relocate to cities willing to pay the price (Baade & Dye, 1988;Baim, 1990;Okner, 1974;Quirk, 1987). Although this may be considered the price to pay for major league status, some argue that the direct and indirect economic benefits offset public subsidies (Northeastern Illinois Planning Commission, 1986). ...
... A growing literature not only fails to associate professional teams and their stadia with improvement in metropolitan economic conditions (Baade, 1994;Baade & Dye, 1988, 1990Euchner, 1993;Quirk, 1987;Quirk & Fort 1992;Rosentraub & Nunn, 1978;Rosentraub, Swindell, Przybylski, & Mullins, 1994) but suggests that public subsidies of stadia may actually send the economy backward because of opportunity costs (Baim, 1990(Baim, , 1992. ...
Article
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Literature challenges the economic wisdom of major league sports stadia, especially when subsidized, but they continue to be constructed. If officials decide that a new stadium will be built, does it matter where it goes? This article theorizes that when major league stadia locate in the central business district (CBD), the metropolitan statistical area’s share of regional wealth increases and that share rises as more major league teams play there. The reason is that people attending games in the CBD are more likely to spend money before and after games in the CBD than if they attend games at non-CBD locations. By contrast, non-CBD stadia may create opportunity costs. The moat of parking that surrounds many such stadia may discourage development from locating nearby. Investments that could have generated more economic activity are diverted, sometimes outside the metropolitan area. Empirical evaluation supports theoretical expectations.
... 3 Cultural affinity explains why Greeks wanted so much to organize the Olympic games while they have never seriously considered to organize a Football World Cup which is much smaller in size. 4 Among many studies that show the same skepticism seeBaade and Dye (1988),Owen (2005) andCoates (2007). ...
... 3 Cultural affinity explains why Greeks wanted so much to organize the Olympic games while they have never seriously considered to organize a Football World Cup which is much smaller in size. 4 Among many studies that show the same skepticism seeBaade and Dye (1988),Owen (2005) andCoates (2007). ...
... 3 Cultural affinity explains why Greeks wanted so much to organize the Olympic games while they have never seriously considered to organize a Football World Cup which is much smaller in size. 4 Among many studies that show the same skepticism seeBaade and Dye (1988),Owen (2005) andCoates (2007). ...
Article
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Marathons are sport tourism events taking place in many cities around the globe. Economic impacts studies have shown that there exist positive economic effects for the host city but the economics literature has questioned the applied methodology. Cost-benefit analyses and general equilibrium approaches have shown that the economic effects may not be positive. This study reviews this literature using an eclectic approach. It emphasizes the long term impacts of promoting exports and attracting foreign direct investment. The Athens marathon is used as a case study.
... Academic economists were quick to respond with assessments of their own as new stadium proposals and their associated EIAs proliferated through the construction boom. Baade & Dye (1988& 1990 provided the initial empirical evidence recommending that sports stadiums are not facilitators of economic development. Economists consistently confirmed these findings throughout the 1990s and into the new millennium, including Baade (1996), Noll & Zimbalist (1997), Zimmerman, (1997, Zimbalist (1998), Coates & Humphreys (1999, Siegfried & Zimbalist (2000), andHumphreys (2001). ...
Article
American universities, belatedly following their professional sports counterparts, are constructing new stadiums. A portion of the funds typically provided to athletic departments are drawn from general university resources. Besides increased revenue flows, indirect benefits that contribute to university objectives are typically cited as part of the demand for a new college stadium. Examples of these spillover benefits are an enhanced campus community, a higher quality student body, and more alumni donations. We analyze a university’s stadium proposal and apply standard capital budgeting techniques to the proposed stadium’s estimated cash flows. It is revealed that the project is a sound financial investment only under the most optimistic circumstances. Yet, the investment can be worthwhile to the university if the net value of the spillover benefits exceeds the financial loss. We consider all likely spillovers, and conclude that it is more likely the desired spillover benefits can be more efficiently achieved with other investment choices.
... In general, studies that analyse the impacts of sporting events and stadium construction, find that their economic impact is negligible. Baade and Dye (1988) used regression analysis to examine the relationship of stadium construction and the addition of a sports team in a city to area income growth. Their results indicate five negative and only two positive statistically significant correlations out of nine cities studied. ...
Article
The Olympic Games have come to be viewed as an unprecedented opportunity to leverage a short-term event into a long-term positive legacy. Although the Olympics are assumed to yield economic benefits, there has been no rigorous analysis of the impact of hosting on residential real estate markets. Utilising a substantial dataset for six host cities and comparable cities between 1984 and 2000, this paper employs an adjusted interrupted time-series approach to estimate the house price impacts of hosting the Olympic Games. The results suggest that the Olympics are not a ‘one size fits all’ economic development strategy and that potential outcomes are dependent on a number of factors, including the co-ordination of planning and Olympic-related development and the relative scale of the total Olympic investment.
... Nevertheless, at least tourism receives some consideration in the context of economic development. Local economic policy has paid much less attention to many other consumer services which also perform a basic-sector function, such as sports facilities (Baade and Dye, 1988;Bale, 1992;Hefner, 1990), higher-education establishments (Armstrong et al, 1994;Florax, 1992;Lewis, 1988), and regional shopping centres (Lowe, 1991;Williams, 1993). ...
... These investments and subsidies represent a transfer of resources to city taxpayers for the dubious benefit of supporting a segment of the entertainment industry and maintaining a city's "major league" reputation (Federal Reserve Bank of Cleveland, 1991). In fact, analysts have concluded that the net economic benefits for a city to have a sports franchises are much more limited than voters and political leaders have assumed (Baade and Dye, 1988;Baade and Dye, 1990). ...
... The problem is that there is little quantifiable evidence to back up his supposition Most of the literature that has evaluated stadia impact draws upon the North American experience and largely focuses on economic analysis (see Baade, 1995 Baade, , 1996 Danielson, 1997; Noll and Zimbalist, 1997; Rosentraub, 1997; Thornley, 2002). In particular, there is a substantial body of literature on the short term economic impacts of stadia and on the relative merits of public development and subsidisation (Baade and Dye, 1988a; 1988b; 1990; Chema, 1996; Rosentraub, 1996 Rosentraub, , 1997 Shropshire, 1995; Swindell and Rosentraub, 1998). However, there is little agreement amongst academics as to whether stadia generate net positive economic outcomes in the longer term. ...
Article
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There has been a favourable shift in UK urban policy towards the use of sporting infrastructure as a catalyst for rejuvenating declining areas. Despite this recent trend, evidence to support the notion that stadia can underpin regeneration goals is highly variable. This paper uses a case study of the City of Manchester Stadium and the Millennium Stadium in Cardiff to examine the impact of stadia construction on the real estate market, an area of economic development that has been significantly under-researched, yet which forms an integral part of the regeneration process. It concludes by arguing that a more comprehensive understanding of the role of stadia in the regeneration process is required if policy makers are to justify future and sustained public investment in sportrelated infrastructure, especially given the significant investment that is planned for the 2012 Olympic Games in London.
... There is some disagreement and confusion within the literature regarding the impacts of facilities on economic development related to the definition of the term local. A majority of the research conducted examining the impacts of sports franchises and their facilities have on economic development focuses on regional or metropolitan level effects (Baade & Dye 1988, 1990Baade, 1996;Coates & Humphreys, 1999Rosentraub, 1997). For these scholars there is a degree of symmetry in the use of the word local to mean regional or metropolitan. ...
Article
While the ways in which fans interact and consume sports has evolved in response to new and broadcast media, the most profound change for cities from sports is its linkage to real estate development. This emerging dimension to the ability of sports to redistribute regional economic activity creates critical public policy, business, and urban planning outcomes and potential. This dissertation identifies the ways in which the sports business has changed and illustrates the ways in which these effects can be channeled to benefit cities. For desired outcomes to occur, however, management and administrative systems have to be created that permit cities to realize the possible advantages. It is also possible that the ways in which sports projects are explained and presented to voters also needs to be changed. These understandings are vital because the positive outcomes for cities from sports and real estate development cannot occur without new decision-making presentations and management systems. This dissertation contributes to a greater understanding of these new requirements and the relationship between sports and real estate development (and its effects on cities) through three separate studies centered on the issues of decision-making, urban planning, and economic and neighborhood development. The research is fashioned to examine processes, designs, and approaches that increase the probability of gains for both teams and the public sector in their development partnerships. The research efforts are interconnected in that they contribute to and expand upon an innovative, developing thread of scholarship in the spatial effects of sports for local economies. Each study covers an important segment of the sports and urban development process that frames this new approach to sport management. The studies focus on (a) voter preferences and reactions to public subsidies for sports facility construction, (b) planned and unforeseen outcomes of a master planned neighborhood anchored by a new ballpark, and (c) the formation of the needed organizational structures to ensure outcomes from a linkage of sports to real estate development can be facilitated to produce desired local effects.
... The under-provision of teams, and their ability to relocate almost at will, has forced US cities to pay most (and sometimes all) of the costs of the teams arenas, stadiums and practice facilities. (Sandy et al., 2004, p. 23) Even though there is overwhelming evidence to conclude that hosting a major sports franchise -or mega events like the Olympics for that matterdoes not lead to any significant economic impacts for the host city (Baade, 1987(Baade, , 1994(Baade, , 1996Baade and Dye, 1988;Rosentraub et al., 1994;Tien et al., 2011), the prestige attached to hosting a pro league team has eased the willingness of politicians to subsidize teams. The very real prospect of franchises relocation urges local governments to subsidize existing franchises and to promise subsidies to prospective relocated franchises in a completion with only one winner. ...
Chapter
Kornai's soft budget constraint (SBC) approach provides a useful framework, which is highly relevant for understanding the economics of European professional sports leagues. However, it has not hitherto been used in a comparative analysis of the European and North American sports leagues. This chapter offers a novel perspective on professional sports leagues that transcends the traditional profit versus win (utility) maximizing distinction by applying the SBC approach. Europe?s win (utility) maximizing teams usually face softness by surviving resounding and/or frequent losses, whereas the budget constraints for North American franchises appear 'hard'. But are the American pro franchises in fact facing hard budget constraints and the survival characteristics of hardness? This chapter gives a brief interpretation of the European context by using the framework of the SBC approach, while further seeking to adjust and apply it to the American context. It points out that even though the American pro leagues are profitable compared to the European ones, many of the European characteristics are in fact at play in the US, revealing an existence of softness in both league types. In order to better understand the similarities as well as the well-known differences across these two traditionally opposed contexts, a new matrix of team sports economics based on the SBC ideas is developed, supplementing existing research and giving new insights into the peculiar economics of professional team sports.
... Although many economists have recognized that a mega-event generates a huge amount of both tangible and intangible benefits beyond those typically measured as economic impacts, governments, politicians, and host organizations often neglect intangible benefits incurred by event visitors. Indeed, Baade and Dye (1988), Noll and Zimbalist (1997), and Owen (2006) criticized the biased results (i.e. often overestimate the positive outcomes) from economic impact studies commissioned by governments and/or host organizations due to the purpose of justifying their financial subsidies and, at the same time, emphasized the importance of immeasurable and intangible benefits (e.g. ...
Article
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This study aims to estimate visitors’ consumption benefits using the double-bounded dichotomous choice contingent valuation method. The results of this study show that the per capita consumption benefit of the F1 Korea Grand Prix, a study context used in this study, were approximately US$307 and then, the total aggregated economic value generated by the event was US$49,262,301 in 2011. These results indicate that visitors of the F1 Korea Grand Prix perceive huge economic benefits from their visitation and activities during the event. In addition, the results show that prior visit experience and a sport identification are significantly associated with visitors’ perceived consumption benefits while other variables (e.g. age, gender, nationality, automotive club membership) are not. Several theoretical, practical, and methodological implications of this study are discussed.
... Kellison 2013). Instead, they can create issues of gentri cation (Baade and Dye 1988;Chapin 2004;Spirou 2010;Whitson and Macintosh 1996) and opportunity costs associated with defunding schools, police, and other public agencies (Eisinger 2000;Greenberg 2000;Howard and Crompton 2013) while serving to redistribute public assets to private capital (Delaney and Eckstein 2003;Jones 2002;Rosentraub et al. 1994;ornley 2002). In the academy, scholars from sport management (Kellison and Mondello Downloaded by [73.207.62.167] at 08:21 14 September 2017 2014), urban and regional planning (Chapin 2004), and the sociology of sport (Bélanger 2000;Coakley 2011;Friedman, Andrews, and Silk 2004;Friedman and Mason 2004;Smith and Ingham 2003) have o ered more empirically grounded analyses of the negative e ects of no-vote stadium nancing schematics. ...
Article
The vast majority of North America’s professional sport arenas, ballparks and stadiums are publicly subsidized without direct approval from voters. In this article, we examine the discursive constitution of ‘no-vote subsidies’ within the public sphere, and in particular problematize the twinned production(s) of citizenship and democratic process in framing public subsidization of these sites of private accumulation. To do this, we examine the recent no-vote subsidy occurring in Columbus, Ohio – thereby providing a context-specific interrogation of the mediations of participatory citizenship, political decision-making and the institution of democracy as related to sport stadium funding. As part of this analysis, we discuss the public production of civic paternalism – a political ideology focused on urban growth and unconcerned with future electoral consequences – in the Columbus arena financing case. We conclude the article with a call for increasing scholarly engagement in, and intervention into, the political processes that result in the public subsidization of professional sport venues.
... A este trabajo le sigue el realizado por Burns, Hatch y Mules (1986) sobre el impacto económico del Gran Prix de Adelaide de 1985. Con respecto a la repercusión económica de las franquicias y de la construcción de estadios, los primeros estudios son publicados en 1988 por Baade y Dye (1988a, 1988b donde se analiza si la repercusión económica de los estadios y los equipos justifica realmente su financiación con fondos públicos. ...
Article
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The study of the economic impact on the sport as a scientific discipline was born for the identification of the economic benefits of major sports events. Its evolution has led to broader approaches. It has been applied to the study not only of the economic aspect but also the intangible effects in both large and small events, in facilities and franchises. In the present work, the evolution of the study the economic impact of sport science is analyzed using bibliometric during the period 1984-2013. The results from these analyses have been used to prepare a questionnaire in order to get the perception of experts in the field on key aspects of research in the scientific issues. From the work, it can be concluded that the economic impact of sport science is capable of evolution in the area of economics of sport and in a complementary manner in other areas. In addition, this kind of studies has a clear practical application for improving the management of sports events and sporting facilities. © 2017, Universidad Autonoma de Madrid y CV Ciencias del Deporte. All rights reserved.
... Mere konkret finder Baade et al. (se: Baade 1987, Baade & Dye 1988, Baade 1994, 1996, Baade & Sanderson 1997 i deres studier af store sportsvenues, at sammenligner man for eksempel byer uden et professionelt sportshold og et tilsvarende stadion med byer, der har, er der ingen målbar forskel på centrale økonomiske variable (Kuper & Szymanski 2009, s. 238-241). ...
Article
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In 2007 a national action plan for major sport events was promoted by the Danish government aimed at using sport as a tool for branding and economic growth. The hosting of events such as the International Olympic Committee’s Session and Congress in 2009, the World Wrestling Championships in 2009, the UEFA European Under-21 Football Championship in 2011 and the UCI World Road Championship in 2011 can be counted among the most prominent results from the action plan. This article discusses whether major sport events have any economic impact on the host country or the respective region by reviewing relevant literature on the subject. Furthermore it uses data from Danish authorities to estimate potential effects, and concludes that economic impacts are marginal. Other effects, such as branding, are also discussed.
... Although the application of multipliers by neutral economic analysts is generally informed by empirical research or by reference to U.S. Department of Commerce standards, consultants hired by project proponents often seem to pull their multipliers out of thin air. Baade and Dye (1988) showed, for example, that economic impact projections for stadium projects have used multipliers that range from 1.2 to 3.2, although no objective factors can explain either the values selected by the consultants or the variation among them. As Rosentraub (1997, 163) stated, "If abused or misrepresented, the multiplier can produce estimates of impact that are nothing more than a mythical expectation of growth." ...
Article
City leaders in the United States devote enormous public resources to the construction of large entertainment projects, including stadiums, convention centers, entertainment districts, and festival malls. Their justification is that such projects will generate economic returns by attracting tourists to the city. Although this economic expectation is tested in the literature, little attention is given to the political and social implications of building a city for visitors rather than local residents. A focus on building the city for the visitor class may strain the bonds of trust between local leaders and the citizenry and skew the civic agenda to the detriment of fundamental municipal services.
... This is in line with results establishing that properties gain value when they are close to the facilities (Coates and Humphreys 2002;Tu 2005). If the relocation of a team alone cannot provide a substantial economic effect (Baade and Dye 1988;Coates and Humphreys 1999;Fort 2003), being part of a broader strategy affecting a specific area of the city can help participate in an economic redevelopment (Siegfried and Zimbalist 2000). Despite this, there is little evidence of the 'tulip bulb' phenomenon reaching sport. ...
Article
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The winner’s curse is a well-known phenomenon in the auction theory. The main aim of this article is to verify its existence in football broadcasting rights. The underlying objective is to assess whether some indices of this situation are verified and can cause a winner’s curse. The methodology is based on the application of Andreff (2014) ’s six indices and a seventh index (disappointment) to the domestic markets for broadcasting rights of the French and English football leagues. These two markets have seen an increase in the number of packages offered to broadcasters, with the possibility of several ‘winners’. The article shows that the winner of the major packages in the auction is not cursed. The curse is more likely to happen for the second mover. As such, the article suggests a practical recommendation for broadcasters interested in football rights: win the best package or keep away.
... North American studies do typically not find evidence that sport franchises create tangible benefits for their communities in relation to employment, income or inbound migration (Baade and Dye, 1988;Siegfried and Zimbalist, 2000;Baade and Matheson, 2004;Baade et al., 2008). Lertwachara and Cochran (2007) even report negative effects on income per capita in areas hosting major league franchises. ...
Article
The purpose of this paper is to examine citizens’ willingness to pay (WTP), in relation to having a professional first-tier football club in a medium-sized Danish municipality, when tangible economic benefits such as economic growth and/or inbound migration produced by these are absent. Using the contingent valuation method on survey respondents, the study examines factors affecting WTP using binary logistic regression and interval regression and further extrapolates the WTP from the sample to the municipal population. Citizens significantly value having a first-tier football club in their municipality even when tangible benefits are absent, although a large proportion of respondents stated to be against the municipality being financially involved in professional team sports clubs (PTSC). WTP is largely driven by interest in sports and the local football club. It is argued that the findings cannot be generalized across contexts. There can be circumstances where public subsidy of PTSCs is beneficial to economic welfare. However, authorities should be careful in their evaluation of whether to subsidize PTSCs. The study expands on existing research by informing respondents about the lack of tangible benefits produced by PTSCs, hereby focusing on WTP on an informed basis.
... According to Zirin (2008), the construction of publicly-funded stadia became a substitute for anything resembling urban policy. The central claim of Baade, one of the most important experts of the study of the impacts of stadia on economic development, is that public investment in stadia does not provide a good return for taxpayers (1996• Baade and Rye, 1988a• 1988b• 1990). Ultimately, a mall or a cineplex would bring more revenue to the local community. ...
Conference Paper
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The main objective of this study is to examine the importance of sport in urban regeneration. Some of the determining factors relate to the multi-dimensional contribution of mega events (and their marketing) in economic development, the growth of urban tourism, the enhanced image of the community, the stimulation of additional development and the benefits in the collective morale of residents ('psychic income', according to John Crompton). Regarding the economic and/or social impacts of mega sport events, there are both positive evaluations and critical analyses (the latter also involves the application of an analysis of the economic impacts). The central theme refers to the role of size (of events, cities and stadia) in the relationship between sports (especially soccer) and urban regeneration. Large stadia certainly help in bidding to host mega events, but perhaps the most effective interpretation of the impacts of mega events does not lie in economic factors. Generally this is also one of the reasons why the efforts to resolve the current socioeconomic crisis should not start with numbers. Globalisation has intensified competition among cities for power and market differentiation, as well as the attraction of investment, visitors, qualified personnel and mega events. Cities are competing in order to become developed, but should both cities and stadia necessarily be large? In this context, city marketing and branding has become a strategic tool in order to promote the competitive advantages of a city. The most common marketing strategies are the adoption of a brand (it may be a soccer team), the innovative construction of buildings (and stadia) and the organisation of mega events. The starting point for an alternative interpretation is the book Soccernomics by Simon Kuper and Stefan Szymanski (2009/2012), which constitutes an illustrative example of a series of interesting 'pop' studies characterising many disciplines. The answer to the rationale for bidding for host mega events (mostly from 'smaller' countries and cities) may mainly lie, not in the prospect of economic and spatial development as a result of planning, but in the new politics of happiness. In connection with this approach, there is an evaluation of the impact of the 2004 Athens Olympics.
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Using the seven weeks of canceled baseball games caused by the 1994 strike as a natural experiment, the author analyzes the degree to which the absence of baseball affected retail trade and hotel room sales in the 24 U.S. cities hosting baseball franchises and in 4 control cites. The most important finding is that the strike had little, if any, economic impact on host cities. Retail trade appeared to be almost completely unaffected by the strike, and the declines in hotel room sales in 10 baseball cities were not consistent with decreases expected by changes associated with the strike.
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International sports events have long evoked the discourses and imagery of internationalism while serving as occasions for the advertisement of the host nation and city. This article seeks to explore some of the tensions that follow from this. It has become almost a truism that hosting international events generates enormous benefits for the host city and region. However, the economic evidence examined suggests that although these events provide short-term windfalls for the local construction and tourist industries, the public sector costs of staging them are understated regularly. This is routinely justified in terms of the importance of establishing an identity as a “world-class” city, but the relationships between public costs and private gains need to be examined carefully. The article argues that the benefits of living in a world-class city are very unevenly distributed, and it raises questions on both economic and equity grounds about the urban strategy of promoting the city as a center for leisure, tourism, and consumption.
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By any measure, major-league baseball in North America surely qualifies as big business. The national pastime is a vital component of today's urban political economy, and baseball teams resemble other high-prestige businesses in that cities must compete for the privilege of hosting them—whatever their true worth. This article analyzes the transfer of the Milwaukee Braves baseball franchise to Atlanta in 1965 as the outcome of “competitive boosterism,” or the active participation of local elites in luring trade, industry, and investment from other cities for the purpose of economic development.
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Entrepreneurial cities in North America are strategically using sport for the purposes of marketing communities as attractive places to live, attractive places to visit, and attractive places to invest. However, how sport is used, and who is behind the strategic actions of cities remains a more nebulous concept. This paper focuses on the role of urban regimes – the networks of political and business elites in cities – involved in local decision-making strategies related to sport. Three areas of focus, sports franchises, sporting events, and sports facilities, are reviewed in terms of the involvement of both public and private sector interests. In doing so, this article bridges the management of place and the management of sport in an attempt to generate insight into how sport fits into civic strategies, and how cities have sought to gain status through sport-related development initiatives.
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About one century ago, professional sports became prominent in American public life. During its early years, the business of sports was primarily a private undertaking, financed with private money and played in private stadiums and arenas. But state and local government subsidies to professional sports businesses have proliferated over the past few decades, and economic arguments have been crafted to justify the subsidies, These arguments typically rest on the assertion that professional sports is a significant, even unique, catalyst for economic growth. By this reckoning, stadiums and teams are "cash cows" that expand the economy and enable further public investment in other critical areas. Public funds are increasingly scarce. We must test the argument that professional sports offer an important return on government subsidies. The purpose of this paper is to use economic theory and empirical techniques to assess the contribution of professional sports to metropolitan area economic development in the United States. The study consists of five parts. Part 1 briefly reviews the economic literature on professional sports and urban development. Part 2 discusses the ways professional sports can have an economic impact on an area and explores the challenges inherent in measuring this effect through "expenditure" and "multiplier" analysis.
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Sports economists have created a sizable literature on the costs and benefits of publicly funded major-league sports stadiums. This research suggests a growing consensus that stadiums provide little economic advantage for local communities. In response, some stadium supporters have modified their tactics to increasingly avoid claims of tangible economic benefits. Instead, they insist that new stadiums offer communities more intangible social benefits. These alleged intangible benefits can take many specific forms but usually have something to do with a community’s self esteem or its collective conscience. This article draws on the authors’ primary research in 10 U.S. cities that are involved in different stages of new stadium construction. The authors demonstrate how local elites socially construct ideas such as community self-esteem and community collective conscience to help them reap large amounts of public dollars for their private stadiums.
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Government involvement in facility construction is typically justified on the basis of ex-ante predictions of economic impact resulting from events hosted at the new or upgraded facility. This paper examines the impact of facility construction on construction sector employment and real GDP across 15 New Zealand cities between 1997 and 2009. Results from static and dynamic models indicate that certain types of facilities had short-term (during construction) positive impacts on construction sector employment growth, although only stadium projects generated positive post-construction employment impacts. There is also little in the way of empirical evidence to suggest that new or upgraded facilities had any significant impact on local area real GDP either during or post-construction.
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Power, prestige, and millions of dollars-these are the stakes in the sports franchise game. In this book, sports attorney Kenneth Shropshire describes the franchise warfare that pits city against city in the fierce bidding competition to capture major league teams. Rigorous research, fascinating interviews with major players, stories behind the headlines, and an insider's perspective converge in this rare view of the business side of professional sports. Shropshire portrays a complex web of motivations, negotiations, and public relations, and discusses examples from Philadelphia, the Bay Area, and Washington D.C. © 1995 by the University of Pennsylvania Press. All rights reserved.
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The need to identify the economic benefits of major sporting events gave rise to the study of the economic impact of sports as a scientific discipline which currently encompasses broad approaches that not only study the economic aspect of sports but also analyze the facilities, franchises, intangible effects, and large and small sporting events. Using a bibliometric analysis, this paper studies the evolution of the economic impact of sport, as a science, over the period 1984-2013. Its results have been used as a base from which to explore how experts perceive key thematic research areas. Finally, the paper concludes on the clearly practical application of this type of research towards improving the management of sports events and facilities where this type of research may well evolve even further spreading into other new areas.
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In this chapter, we discuss and highlight research from interesting and relevant publications that feature applications of these analytical methodologies to many economics, education, strategy development and assessment, health issues, and biomechanics.
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This article evaluates the revenue performance failings of the Yum! Center, a sports arena in Louisville, with the primary objective of explaining how a flawed deal arose in the first place. While the literature addressing public subsidization of sports facilities primarily contemplates economic impact underperformance, Louisville provides an extreme instance of failed financial performance leading to a bailout. The revenue challenges, arising from sales-tax increment financing and the lease agreement, link the arena to a wider literature on megaproject underperformance, characterized by three primary threads: rent-seeking, governance structures, and project cultures. This article evaluates the Yum! Center through representative lenses from each of these threads before offering key lessons for future projects.
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The sports industry provides a seemingly endless set of examples from every area of microeconomics, giving students the opportunity to study economics in a context that holds their interest. Thoroughly updated to reflect the current sports landscape, The Economics of Sports introduces core economic concepts and theories and applies them to American and international sports. Updates for this sixth edition include: • More coverage of international sports, including European football; • A revised chapter on competitive balance, reflecting new techniques; •A brand-new chapter on mega-events such as the Olympics and World Cup; • New material on umpire bias; • A completely redesigned chapter on amateur competition that focuses exclusively on intercollegiate sports. This chapter is also now modular, enabling instructors who wish to intersperse it with the other chapters to do so with greater ease. This accessible text is supported by a companion website which includes resources for students and instructors. It is the perfect text for advanced undergraduate and graduate courses on sports economics.
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The estimation of the economic effects of cultural events is a topic that has stirred numerous debates in cultural economics. Although economic impact studies and contingent valuation have been the most frequently used methods, both suffer from numerous problems. In this article, we use ex-post econometric verification as a new and promising method in cultural economics in the estimation of the economic effects of cultural events and apply it to the estimation of the effects of the 2012 European Capital of Culture Maribor on tourism and employment. This enables us to compare results from economic impact and ex-post econometric verification studies to find significant differences in particular in terms of new employment. We determine the net effects on new tourism and find that they were mainly present in Maribor, the holder of the project, and not in the other five partner cities. We conclude by reflecting on the state of the art of the studies of economic effects of cultural events in cultural economics and their relevance for the study of cultural tourism.
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It is a common argument in Denmark that municipal involvement in professional team sports can be justified on the grounds of local impact. The use of public funds to directly or indirectly subsidise local professional team sports clubs (PTSCs) is often seen as warranted due to the PTSCs’ positive effects on local economic growth or (inbound) municipal migration. However, can PTSCs be associated with tangible effects at all? This question has never been answered properly in a European context. Based on data covering the 2008–2013 period, and using spatial panel regression models, this article examines this issue in relation to three dominant professional sports in Denmark: football (soccer), handball and ice hockey. The study finds effects for only one of the sports examined, with Danish handball clubs exercising a marginal effect on average income. Ice hockey’s effect is negative and football remains insignificant in all models deployed. Concerning migration, negative effects are found in relation to female handball clubs. These findings are consistent with previous research and have implications for local sport policies and managers. Municipal politicians, public authorities or sport managers should no longer rationalise the use of public funds for local PTSCs on the assumption of (tangible) economic effects or population growth, as it appears to be an inefficient use of public money. If policy makers want to increase municipal income or inbound migration, they should engage themselves in developing more appropriate strategies.
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Architecture_MPS is the academic journal of the research group AMPS (Architecture, Media, Politics, Society). It addresses the growing interest in the social and political interpretation of the built environment from a multi-disciplinary perspective. It engages with architecture, urbanism, planning, sociology, economics, cultural studies, visual culture, new medias and technologies. It draws on experts who bring emerging issues of international importance to the reader. Its publications are linked with a wide range of research programmes and conferences to further raise awareness of the social importance of architecture.
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In recent years, there has been a favourable shift in UK urban policy towards the use of sport as a tool for regenerating declining areas. Sporting infrastructure has been constructed in various British cities with a view to addressing the dual aims of sporting need and urban regeneration. However, evidence to support the notion that sport can underpin regeneration goals is highly variable. This paper will explore the growth of sport-related regeneration in the UK and examine the evidence base for this. In particular, it will focus on the economic literature and evaluate the strengths and weaknesses of emerging evidence. It will suggest that with investment in sport likely to increase as a consequence of the London 2012 Olympic Games, there is a need to develop a greater understanding of the role of sport in the regeneration process, to maximize the potential benefits and to justify public expenditure on sport in the future.
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This study situates the narratives surrounding the value of the Winnipeg Jets and a new publicly funded arena within the context of the recent discussions on the cultural impact of globalization on local and national identities. In addition, interest groups and local power relations that were promoting or challenging specific narratives surrounding the value of the team and a new publicly funded arena are examined. The results indicate that specific interest groups actively constructed narratives that promoted the value of the Jets and a new arena to the global-local identity of Winnipeg and Canada's national identity. Conversely, counter-narratives challenged the importance of the Jets to local and national identities, while not directly addressing the issue of global identity. These results reveal the interaction of global and local forces and the relative ability of individuals/groups to produce local narratives and particularities that both reinforce and challenge the processes of globalization.
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Despite the historic and popular alignment of ice hockey with Canadian identity, the public subsidization of National Hockey League (NHL) franchises remains a highly contentious public issue in Canada. In January 2000 the Canadian government announced a proposal to subsidize Canadian-based NHL franchises. The proposal, however, received such a hostile national response that only three days after its release an embarrassed Liberal government was forced to rescind it. This article explores how Canadian anglophone newspapers mediated the NHL subsidy debate and emerged as critical sites through which several interrelated issues were contested: the subsidization of NHL franchises, competing discourses of Canadian national identity, and the broader political-economic and sociocultural impacts of the Canadian government's adherence to a neoliberal agenda.
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Economic development practitioners often chase the next great idea to grow their economy, especially their downtowns. A project that many large cities have looked to as a panacea is the sports stadium. Smaller, mid-sized cities have also joined the stadium craze by poaching Minor League Baseball (MiLB) teams via flashy downtown stadium developments, often using the same playbook that large cities have employed. Recently, the City of Wichita, Kansas, undertook a minor league stadium project as an economic development strategy. This paper uses an urban regime theory lens to track the political deal-making and financial engineering that made it possible for Wichita to lure the “Baby Cakes” MiLB team from New Orleans. This study demonstrates that mid-sized cities use the same backroom deal-making perfected by their larger peers to push a fragile form of development that frequently makes minimal economic sense.
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In the past decade, America has experienced an urban renaissance. Cities as varied as New York, Chicago and Boston are no longer seen as ungovernable and doomed to crime and blight. However, they still face formidable problems. Urban Policy Reconsidered is a comprehensive overview of the issues and problems facing our cities today and cover every important issue in urban affairs. What is poverty? What is economic development? What is education? What is crime? As well as covering all of these fundamental topics in-depth, the author propose a communitarian approach to addressing the many problems of our cities. This book will be the manual for anyone interested in understanding urban policy. © 2003 Charles C. Euchner and Stephen J. McGovern. All rights reserved.
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Examine the big-league benefits of minor league baseball! The Minor League Baseball: Community Building Through Hometown Sports examines the role played by minor league baseball in hundreds of cities and towns across the United States. Written from the unique perspective of a sociologist who also happens to be an avid baseball fan, the book looks at the contributions minor league teams make to the quality of life in their communities, creating focal points for spirit and cohesiveness while providing opportunities for interaction and entertainment. The book links theory and experience to present a "sociology of baseball" that explains the symbiotic relationship which brings people together for a common purpose-to root, root, root for the home team. From the author: Minor league baseball is played across the country in more than 100 very different communities. These communities seem to share a special bond with their teams. As with all sports teams, there is a symbiotic relationship between the team and the city or town that it represents. In the case of major league professional sports, the relationship is often fueled by economic outcomes. On the minor league level, the relationship appears to go beyond mere money and prestige. Minor league teams occupy a special place in our hearts. We are more forgiving when they lose, and extremely proud of them when they win. Minor League Baseball: Community Building Through Hometown Sports is a detailed look at the connection between town and team, including: • economic benefits (development strategies, community growth) • intangible benefits (ballpark camaraderie, hometown pride) • fan attachment and attendance (demographic variables, stadium accessibility, "home court advantage") • case studies of two Maryland minor-league franchises--the Class AA Bowie Baysox and the Class A Hagerstown Suns Minor League Baseball: Community Building Through Hometown Sports also includes an introduction to the organizational structure of the minor leagues, a history of each current league, and charts and tables on attendance figures and franchise relocations. This book is essential reading for sociologists, sport sociologists/historians, academics and/or practitioners in the fields of community sociology and psychology, and of course, baseball fans.
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In 1990, the Major League Baseball owners announced that the National League would add two new franchises in 1993. Two issues immediately confronted the various groups attempting to secure a baseball franchise for Denver. One was finding an owner for the franchise, the other was providing a stadium for the team. This study focuses on the events and social processes involved in the baseball stadium issue in Denver's bid to secure a major league baseball franchise. The taxpayers of metropolitan Denver were asked to vote on a sales tax initiative that would finance the construction and operation of a new baseball stadium ifaMajorLeagueBaseballfranchisewasultimatelyawardedtoDenver. This study centers on how various forms of power were used to persuade taxpayers that they should pay the costs of constructing a baseball stadium and how the same forms of power were later used to obtain a stadium lease agreement. Other issues addressed by this study include why citizens were not more active in questioning either the public expen diture of money for the construction of a stadium or the terms of the stadium lease agreement. Analyses and explanations for these questions are grounded in the dynamics of power as it was employed by the various entities whose interest was in securing a Major League Baseball franchise for Denver.
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