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The Dallas Cowboys’ Relocation and Intra-metropolitan Sales Tax Revenue Impacts Across Cities and Industries

In: The Economic Impact of Sports Facilities, Franchises, and Events

Author

Listed:
  • Geoffrey Propheter

    (University of Colorado Denver)

  • Shihao Dai

    (University of Colorado Denver)

Abstract

The leading explanation for decades of evidence that sports facilities generate no metropolitan-level economic impacts is that they redistribute, rather than increase, economic activity within metros. This chapter offers a test of the intra-metropolitan redistribution hypothesis. The Dallas Cowboys moved from Irving to Arlington in 2009, a 12-mile relocation within the Dallas-Fort Worth metro. We use the synthetic control method to model sales tax revenue changes within each city when the Cowboys moved. We further explore how the relocation affected different industries within and across each city. We find that total sales tax revenue in both cities increases following the relocation of the Cowboys, but the effect size is trivial and roughly equal to a rounding error in the cities’ budgets. We also find that the new stadium increased spending in the accommodation, food services, and entertainment industries, but these were offset by relatively large losses in retail spending. Our findings help explain metropolitan-level null effects in consumer spending, giving empirical weight to arguments that professional sports do more to redistribute tax revenue streams than grow them.

Suggested Citation

  • Geoffrey Propheter & Shihao Dai, 2023. "The Dallas Cowboys’ Relocation and Intra-metropolitan Sales Tax Revenue Impacts Across Cities and Industries," Sports Economics, Management, and Policy, in: Victor A. Matheson & Robert Baumann (ed.), The Economic Impact of Sports Facilities, Franchises, and Events, pages 131-143, Springer.
    • Handle: RePEc:spr:semchp:978-3-031-39248-1_9
    DOI: 10.1007/978-3-031-39248-1_9
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