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Who Sits in Australia’s Grandstands?

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  • John K. Wilson
  • John J. Siegfried

Abstract

Numerous sports stadiums in Australia have been renovated or built from scratch in the past two decades, funded in whole or part by public subsidies. This note focuses on one particular group that benefits from subsidies—those spectators who attend live sporting events. A portion of the benefits from subsidies provided by government are captured as increased consumer surplus by sporting fans. Thus, the income and wealth position of these fans are of interest to those deciding whether to subsidize a facility. On the other side of the equation, the taxes which fund sporting facilities are to a large degree state and local levies, which are mostly regressive, taking a larger portion of the income of lower and middle income than of higher income taxpayers because savings are usually exempt from the relevant taxes. Using data from the Household Expenditure Survey (1988-1989, 2009-2010) , we analyze various financial status characteristics of those who pay to attend sporting events in Australia. We find that those who buy tickets to sporting events have higher annual incomes and greater wealth than Australians who do not purchase tickets to sporting events. Hence, while media and policy makers may view such funding as subsidizing “working man’s recreation,†our results suggest that funding of sporting arenas should be assessed through the lens of correcting market failures rather than equity considerations.

Suggested Citation

  • John K. Wilson & John J. Siegfried, 2018. "Who Sits in Australia’s Grandstands?," Journal of Sports Economics, , vol. 19(3), pages 389-397, April.
    • Handle: RePEc:sae:jospec:v:19:y:2018:i:3:p:389-397
    DOI: 10.1177/1527002516656728
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    References listed on IDEAS

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    1. Robert A. Baade, 2003. "Evaluating Subsidies for Professional Sports in the United States and Europe: A Public-Sector Primer," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 19(4), pages 585-597, Winter.
    2. John Siegfried & Andrew Zimbalist, 2006. "The Economic Impact of Sports Facilities, Teams and Mega-Events," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 39(4), pages 420-427, December.
    3. John K. Wilson & Richard Pomfret, 2014. "Public Policy and Professional Sports," Books, Edward Elgar Publishing, number 15381.
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    Cited by:

    1. Rolfe, John, 2019. "Simple economic frameworks to evaluate public investments in sporting events in regional Australia," Economic Analysis and Policy, Elsevier, vol. 63(C), pages 35-43.

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