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Professional Sports Subsidies and Urban Congestion Externalities: Assessing 50 Years of Failed Urban Economic Development Policies

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  • Brad R. Humphreys

    (West Virginia University)

Abstract

For the past 50 years, state and local governments in North America heavily subsidized the construction of professional sports facilities despite the fact that only private activity takes place in these facilities. Proponents of these subsidies frequently claim that they are justified because they represent viable local economic development projects. A proponents claim a new facility will “pay for itself” by generating large tangible economic benefits, including increases in tax revenues. This paper summarizes the existing literature that contains no evidence supporting these claims, along with a new literature containing evidence that professional sports events cause a number of negative urban congestion externalities like increased crime and traffic. The paper also documents trends in subsidization over the past 50 years and discusses reasons why these subsidies persist. The paper emphasizes the role played by my research in this area.

Suggested Citation

  • Brad R. Humphreys, 2023. "Professional Sports Subsidies and Urban Congestion Externalities: Assessing 50 Years of Failed Urban Economic Development Policies," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 49(4), pages 457-474, October.
    • Handle: RePEc:pal:easeco:v:49:y:2023:i:4:d:10.1057_s41302-023-00245-2
    DOI: 10.1057/s41302-023-00245-2
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    References listed on IDEAS

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    8. Victor Matheson, 2019. "Is There A Case For Subsidizing Sports Stadiums?," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 38(1), pages 271-277, January.
    9. Humphreys, Brad R. & Nowak, Adam, 2017. "Professional sports facilities, teams and property values: Evidence from NBA team departures," Regional Science and Urban Economics, Elsevier, vol. 66(C), pages 39-51.
    10. Charles C. Tu, 2005. "How Does a New Sports Stadium Affect Housing Values? The Case of FedEx Field," Land Economics, University of Wisconsin Press, vol. 81(3).
    11. Stephen L. Locke, 2019. "Estimating The Impact Of Major League Baseball Games On Local Air Pollution," Contemporary Economic Policy, Western Economic Association International, vol. 37(2), pages 236-244, April.
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    14. Anping Chen & Marlon Boarnet & Mark Partridge & Haifang Huang & Brad R. Humphreys, 2014. "New Sports Facilities And Residential Housing Markets," Journal of Regional Science, Wiley Blackwell, vol. 54(4), pages 629-663, September.
    15. Charles Stoecker & Nicholas J. Sanders & Alan Barreca, 2016. "Success Is Something to Sneeze At: Influenza Mortality in Cities that Participate in the Super Bowl," American Journal of Health Economics, MIT Press, vol. 2(1), pages 125-143, January.
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    18. Yulia Chikish & Brad R. Humphreys & Crocker Liu & Adam Nowak, 2019. "Sports‐Led Tourism, Spatial Displacement, And Hotel Demand," Economic Inquiry, Western Economic Association International, vol. 57(4), pages 1859-1878, October.
    19. Coates, Dennis & Humphreys, Brad R., 2006. "Proximity benefits and voting on stadium and arena subsidies," Journal of Urban Economics, Elsevier, vol. 59(2), pages 285-299, March.
    20. Brad R. Humphreys & Hyunwoong Pyun, 2018. "Professional sporting events and traffic: Evidence from U.S. cities," Journal of Regional Science, Wiley Blackwell, vol. 58(5), pages 869-886, November.
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    23. Kaitlyn Harger & Brad R. Humphreys & Amanda Ross, 2016. "Do New Sports Facilities Attract New Businesses?," Journal of Sports Economics, , vol. 17(5), pages 483-500, June.
    24. Alexander Cardazzi & Brad Humphreys & Jane E. Ruseski & Brian P. Soebbing & Nicholas Watanabe, 2020. "Professional Sporting Events Increase Seasonal Influenza Mortality in US Cities," Working Papers 20-08, Department of Economics, West Virginia University.
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    More about this item

    Keywords

    Subsidies; Professional sports; Urban development policy;
    All these keywords.

    JEL classification:

    • D04 - Microeconomics - - General - - - Microeconomic Policy: Formulation; Implementation; Evaluation
    • D42 - Microeconomics - - Market Structure, Pricing, and Design - - - Monopoly
    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
    • Z23 - Other Special Topics - - Sports Economics - - - Finance

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