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The effect of professional sports on the earnings of individuals: evidence from microeconomic data

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  • Dennis Coates
  • Brad Humphreys

Abstract

This article examines the impact of professional sports franchises in labour markets using data from the March Supplement to the Current Population Survey (CPS) for workers employed in specific occupational groups in all large US cities from 1983 to 2002. Results from a standard wage model suggest that professional football franchises increase average hourly and weekly earnings of males employed in these occupations, but professional baseball franchises reduce them. These results support growing evidence that professional sports affect labour markets. However, the mixed nature of the association between sport and earnings provides little economic justification for government subsidies for professional sport.

Suggested Citation

  • Dennis Coates & Brad Humphreys, 2011. "The effect of professional sports on the earnings of individuals: evidence from microeconomic data," Applied Economics, Taylor & Francis Journals, vol. 43(29), pages 4449-4459.
  • Handle: RePEc:taf:applec:v:43:y:2011:i:29:p:4449-4459
    DOI: 10.1080/00036846.2010.491464
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    References listed on IDEAS

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    6. Dennis Coates & Brad R. Humphreys, 2001. "The Economic Consequences of Professional Sports Strikes and Lockouts," Southern Economic Journal, John Wiley & Sons, vol. 67(3), pages 737-747, January.
    7. Dennis Coates & Brad R. Humphreys, 1999. "The growth effects of sport franchises, stadia, and arenas," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 18(4), pages 601-624.
    8. Topel, Robert H, 1986. "Local Labor Markets," Journal of Political Economy, University of Chicago Press, vol. 94(3), pages 111-143, June.
    9. Coates, Dennis & Humphreys, Brad R., 2003. "The effect of professional sports on earnings and employment in the services and retail sectors in US cities," Regional Science and Urban Economics, Elsevier, vol. 33(2), pages 175-198, March.
    10. Dennis Coates & Brad R. Humphreys, 2001. "The Economic Consequences of Professional Sports Strikes and Lockouts," Southern Economic Journal, John Wiley & Sons, vol. 67(3), pages 737-747, January.
    11. Moulton, Brent R, 1990. "An Illustration of a Pitfall in Estimating the Effects of Aggregate Variables on Micro Unit," The Review of Economics and Statistics, MIT Press, vol. 72(2), pages 334-338, May.
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    Citations

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    Cited by:

    1. 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.
    2. Lasse Steiner & Bruno Frey & Simone Hotz, 2015. "European Capitals of Culture and life satisfaction," Urban Studies, Urban Studies Journal Limited, vol. 52(2), pages 374-394, February.
    3. Jennifer M. Connolly & Michael Touchton, 2020. "The Lure of New Jobs: How Framing Impacts Perceptions of Local Subsidies for Sports Teams," Public Budgeting & Finance, Wiley Blackwell, vol. 40(4), pages 86-103, December.
    4. Carlos Pestana Barros & Nicolas Peypoch & Scott Tainsky, 2014. "Cost efficiency of French soccer league teams," Applied Economics, Taylor & Francis Journals, vol. 46(8), pages 781-789, March.
    5. Geoffrey Propheter, 2019. "Estimating the Effect of Sports Facilities on Local Area Commercial Rents: Evidence From Brooklyn’s Barclays Center," Journal of Sports Economics, , vol. 20(1), pages 91-114, January.
    6. Kavetsos, Georgios & Szymanski, Stefan, 2010. "National well-being and international sports events," Journal of Economic Psychology, Elsevier, vol. 31(2), pages 158-171, April.
    7. Geoffrey Propheter, 2020. "Does Proximity to a New Sports Facility Affect Existing Businesses’ Survival Time?," Journal of Sports Economics, , vol. 21(5), pages 451-476, June.
    8. Brooke Crutchfield & Jonathan Willner, 2016. "Football in Greater Manchester: Growth Effects of Premiership Status Teams," International Advances in Economic Research, Springer;International Atlantic Economic Society, vol. 22(4), pages 447-456, November.
    9. Giles Atkinson & Susana Mourato & Stefan Szymanski & Ece Ozdemiroglu, 2008. "Are We Willing to Pay Enough to `Back the Bid'?: Valuing the Intangible Impacts of London's Bid to Host the 2012 Summer Olympic Games," Urban Studies, Urban Studies Journal Limited, vol. 45(2), pages 419-444, February.
    10. Muhammad Q. Islam, 2019. "Local Development Effect of Sports Facilities and Sports Teams: Case Studies Using Synthetic Control Method," Journal of Sports Economics, , vol. 20(2), pages 242-260, February.
    11. Geoffrey Propheter, 2021. "Sports facilities and the local property tax base in recovery," Regional Science Policy & Practice, Wiley Blackwell, vol. 13(5), pages 1687-1701, October.
    12. C. P. Barros & O. H. dos S. Figueiredo & Silvestre Dumbo, 2016. "A performance assessment of the Angolan soccer league," Applied Economics, Taylor & Francis Journals, vol. 48(29), pages 2711-2720, June.

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    More about this item

    JEL classification:

    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism
    • R58 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Regional Government Analysis - - - Regional Development Planning and Policy
    • J30 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - General
    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue

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