IDEAS home Printed from https://ideas.repec.org/a/bla/ecinqu/v62y2024i4p1722-1747.html

Revisiting the novelty effect from new stadiums: An event study approach

Author

Listed:
  • John Charles Bradbury

Abstract

This analysis examines the impact of new stadiums on consumer demand for sports spectatorship in the four major US‐based professional sports leagues. Estimates from difference‐in‐differences event studies identify a transitory attendance shock from new venues that diminishes to pre‐stadium‐treatment levels within a decade. The updated estimates confirm the existence of the novelty effect in modern facilities and identify subtle differences in magnitude, certainty, and duration across leagues. Revenue estimates indicate that the substantial financial returns from constructing new stadiums likely incentivize the premature replacement of host venues when combined with typical public subsidy levels.

Suggested Citation

  • John Charles Bradbury, 2024. "Revisiting the novelty effect from new stadiums: An event study approach," Economic Inquiry, Western Economic Association International, vol. 62(4), pages 1722-1747, October.
    • Handle: RePEc:bla:ecinqu:v:62:y:2024:i:4:p:1722-1747
    DOI: 10.1111/ecin.13231
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/ecin.13231
    Download Restriction: no
    File URL: https://libkey.io/10.1111/ecin.13231?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Goodman-Bacon, Andrew, 2021. "Difference-in-differences with variation in treatment timing," Journal of Econometrics, Elsevier, vol. 225(2), pages 254-277.
    2. Marc Poitras, 2006. "Do New Major League Ballparks Pay for Themselves?," The Journal of Business, University of Chicago Press, vol. 79(5), pages 2275-2300, September.
    3. John C. Leadley & Zenon X. Zygmont, 2006. "When Is the Honeymoon Over? National Hockey League Attendance, 1970­2003," Canadian Public Policy, University of Toronto Press, vol. 32(2), pages 213-232, June.
    4. John Charles Bradbury & Dennis Coates & Brad R. Humphreys, 2023. "The impact of professional sports franchises and venues on local economies: A comprehensive survey," Journal of Economic Surveys, Wiley Blackwell, vol. 37(4), pages 1389-1431, September.
    5. Jan C. van Ours, 2024. "No Novelty Effect but a Honeymoon that Lasts On the Attendance Effects of New Football Stadiums," Tinbergen Institute Discussion Papers 24-010/V, Tinbergen Institute.
    6. Sung, Hojun & Mills, Brian M., 2018. "Estimation of game-level attendance in major league soccer: Outcome uncertainty and absolute quality considerations," Sport Management Review, Elsevier, vol. 21(5), pages 519-532.
    7. Stefan Szymanski, 2023. "Anticipating the honeymoon: Event study estimation of new stadium effects in Major League Baseball using the imputation method," Economic Inquiry, Western Economic Association International, vol. 61(4), pages 1077-1102, October.
    8. Robert W. Wassmer & Ryan S. Ong & Geoffrey Propheter, 2016. "Suggestions for the Needed Standardization of Determining the Local Economic Impact of Professional Sports," Economic Development Quarterly, , vol. 30(3), pages 252-266, August.
    9. Christopher M. Clapp & Jahn K. Hakes, 2005. "How Long a Honeymoon? The Effect of New Stadiums on Attendance in Major League Baseball," Journal of Sports Economics, , vol. 6(3), pages 237-263, August.
    10. Kevin G. Quinn & Paul B. Bursik & Christopher P. Borick & Lisa Raethz, 2003. "Do New Digs Mean more Wins?," Journal of Sports Economics, , vol. 4(3), pages 167-182, August.
    11. Chad D. McEvoy & Mark S. Nagel & Timothy D. DeSchriver & Matthew T. Brown, 2005. "Facility Age and Attendance in Major League Baseball," Sport Management Review, Taylor & Francis Journals, vol. 8(1), pages 19-41, January.
    12. John Charles Bradbury & Dennis Coates & Brad R. Humphreys, 2024. "Public policy toward professional sports stadiums: A review," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 43(3), pages 899-937, June.
    13. Kirill Borusyak & Xavier Jaravel & Jann Spiess, 2024. "Revisiting Event-Study Designs: Robust and Efficient Estimation," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 91(6), pages 3253-3285.
    14. John C. Leadley & Zenon X. Zygmont, 2005. "When Is the Honeymoon Over? National Basketball Association Attendance 1971-2000," Journal of Sports Economics, , vol. 6(2), pages 203-221, May.
    15. Charles F. Manski & John V. Pepper, 2018. "How Do Right-to-Carry Laws Affect Crime Rates? Coping with Ambiguity Using Bounded-Variation Assumptions," The Review of Economics and Statistics, MIT Press, vol. 100(2), pages 232-244, May.
    16. Seth R. Gitter & Thomas A. Rhoads, 2014. "Stadium Construction And Minor League Baseball Attendance," Contemporary Economic Policy, Western Economic Association International, vol. 32(1), pages 144-154, January.
    17. Geoffrey Propheter, 2017. "Subsidies and Stadia’ Opulence," Journal of Sports Economics, , vol. 18(1), pages 3-18, January.
    18. Ashesh Rambachan & Jonathan Roth, 2023. "A More Credible Approach to Parallel Trends," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 90(5), pages 2555-2591.
    19. Dennis Coates & Brad R. Humphreys, 2005. "Novelty Effects Of New Facilities On Attendance At Professional Sporting Events," Contemporary Economic Policy, Western Economic Association International, vol. 23(3), pages 436-455, July.
    20. Yinle Huang & Brian P. Soebbing, 2022. "The novelty effect and on-field team performance in new sports facilities: the case of the Canadian Football League," Sport Management Review, Taylor & Francis Journals, vol. 25(1), pages 188-205, January.
    21. Roth, Jonathan & Sant’Anna, Pedro H.C. & Bilinski, Alyssa & Poe, John, 2023. "What’s trending in difference-in-differences? A synthesis of the recent econometrics literature," Journal of Econometrics, Elsevier, vol. 235(2), pages 2218-2244.
    22. Brian P Soebbing & Daniel S Mason & Brad R Humphreys, 2016. "Novelty effects and sports facilities in smaller cities: Evidence from Canadian hockey arenas," Urban Studies, Urban Studies Journal Limited, vol. 53(8), pages 1674-1690, June.
    23. Callaway, Brantly & Sant’Anna, Pedro H.C., 2021. "Difference-in-Differences with multiple time periods," Journal of Econometrics, Elsevier, vol. 225(2), pages 200-230.
    24. John Charles Bradbury, 2019. "Determinants Of Revenue In Sports Leagues: An Empirical Assessment," Economic Inquiry, Western Economic Association International, vol. 57(1), pages 121-140, January.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Stefan Szymanski, 2023. "Anticipating the honeymoon: Event study estimation of new stadium effects in Major League Baseball using the imputation method," Economic Inquiry, Western Economic Association International, vol. 61(4), pages 1077-1102, October.
    2. Jan C. van Ours, 2024. "No Novelty Effect but a Honeymoon that Lasts On the Attendance Effects of New Football Stadiums," Tinbergen Institute Discussion Papers 24-010/V, Tinbergen Institute.
    3. John Charles Bradbury & Dennis Coates & Brad R. Humphreys, 2024. "Public policy toward professional sports stadiums: A review," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 43(3), pages 899-937, June.
    4. Aguilar-Loyo, Jhordano, 2025. "A comparative analysis of two-way fixed effects estimators in staggered treatment designs," Journal of Econometrics, Elsevier, vol. 251(C).
    5. Ratzanyel Rinc'on & Kyungchul Song, 2025. "Causal Inference with Groupwise Matching," Papers 2510.26106, arXiv.org.
    6. Gregory Faletto, 2023. "Fused Extended Two-Way Fixed Effects for Difference-in-Differences With Staggered Adoptions," Papers 2312.05985, arXiv.org, revised Apr 2025.
    7. Bach, Philipp & Klaaßen, Sven & Kueck, Jannis & Mattes, Mara & Spindler, Martin, 2025. "Sensitivity analysis for treatment effects in difference-in-differences models using Riesz Rrepresentation," Discussion Papers 2025/7, Free University Berlin, School of Business & Economics.
    8. John Charles Bradbury, 2019. "Determinants Of Revenue In Sports Leagues: An Empirical Assessment," Economic Inquiry, Western Economic Association International, vol. 57(1), pages 121-140, January.
    9. Philipp Bach & Sven Klaassen & Jannis Kueck & Mara Mattes & Martin Spindler, 2025. "Sensitivity Analysis for Treatment Effects in Difference-in-Differences Models using Riesz Representation," Papers 2510.09064, arXiv.org.
    10. Arne Henningsen & Guy Low & David Wuepper & Tobias Dalhaus & Hugo Storm & Dagim Belay & Stefan Hirsch, 2024. "Estimating Causal Effects with Observational Data: Guidelines for Agricultural and Applied Economists," IFRO Working Paper 2024/03, University of Copenhagen, Department of Food and Resource Economics.
    11. Kyunghoon Ban & D'esir'e K'edagni, 2022. "Robust Difference-in-differences Models," Papers 2211.06710, arXiv.org, revised Aug 2023.
    12. Tatsuru Kikuchi, 2025. "A Unified Framework for Spatial and Temporal Treatment Effect Boundaries: Theory and Identification," Papers 2510.00754, arXiv.org, revised Oct 2025.
    13. Ben Deaner & Chen-Wei Hsiang & Andrei Zeleneev, 2025. "Inferring Treatment Effects in Large Panels by Uncovering Latent Similarities," Papers 2503.20769, arXiv.org, revised Mar 2025.
    14. Li, Daiyue & Jin, Yanhong & Cheng, Mingwang, 2024. "Unleashing the power of industrial robotics on firm productivity: Evidence from China," Journal of Economic Behavior & Organization, Elsevier, vol. 224(C), pages 500-520.
    15. Prem, Mounu & Purroy, Miguel E. & Vargas, Juan F., 2025. "Landmines: The local effects of demining," Journal of Public Economics, Elsevier, vol. 247(C).
    16. Shen, Houqi & Zhang, Yuanmeng & Wang, Mingzhe & Lei, Yumeng, 2025. "Unlocking the dual benefits: Economic and ecological impacts of China's National Key Ecological Function Areas," China Economic Review, Elsevier, vol. 90(C).
    17. Hu, Wen-Quan & Su, Yunqing & Fang, Hongsheng, 2025. "Constraints and incentives: Promoting air pollution governance through performance evaluation system," Journal of Asian Economics, Elsevier, vol. 98(C).
    18. Zhang, Lin & Xu, Wenli, 2025. "Television exposure in early childhood and subsequent cognitive outcomes: Evidence from rural China," Journal of Economic Behavior & Organization, Elsevier, vol. 230(C).
    19. Brown, Nicholas L. & Butts, Kyle, 2025. "Dynamic treatment effect estimation with interactive fixed effects and short panels," Journal of Econometrics, Elsevier, vol. 250(C).
    20. Brian P Soebbing & Daniel S Mason & Brad R Humphreys, 2016. "Novelty effects and sports facilities in smaller cities: Evidence from Canadian hockey arenas," Urban Studies, Urban Studies Journal Limited, vol. 53(8), pages 1674-1690, June.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:ecinqu:v:62:y:2024:i:4:p:1722-1747. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/weaaaea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.