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The Economics of Sports Facilities and Their Communities

Author

Listed:
  • John J. Siegfried
  • Andrew Zimbalist

Abstract

Since the 1950s, taxpayers have been the primary investors in stadia built for the use of privately-owned professional sports teams. Team owners have argued that sports facilities boost local economic activity; however, economic reasoning and empirical evidence suggest the opposite. Public support for stadia is also driven by demand for community image, and owners of sports teams supply a scarce input into image enhancement--participation in the major league--for which they have been able to extract monopoly rents from dispersed taxpayers. We suggest reforms to dissipate the monopoly sports leagues exercise when negotiating with host communities for their teams.

Suggested Citation

  • John J. Siegfried & Andrew Zimbalist, 2000. "The Economics of Sports Facilities and Their Communities," Journal of Economic Perspectives, American Economic Association, vol. 14(3), pages 95-114, Summer.
  • Handle: RePEc:aea:jecper:v:14:y:2000:i:3:p:95-114
    Note: DOI: 10.1257/jep.14.3.95
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    File URL: http://www.aeaweb.org/articles.php?doi=10.1257/jep.14.3.95
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    More about this item

    JEL classification:

    • R53 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Public Facility Location Analysis; Public Investment and Capital Stock
    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism

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