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Willingness to Pay for Downtown Public Goods Generated by Large, Sports-Anchored Development Projects: The CVM Approach

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  • Bruce K. Johnson
  • John C. Whitehead
  • Daniel S. Mason
  • Gordon J. Walker

Abstract

North American cities have long encouraged redevelopment of their downtown cores to counteract the flight of residents and business to the suburbs in the postwar period. Building subsidized arenas and stadiums for professional sports teams downtown became common in the 1960s. In recent years, downtown stadiums and arenas have been proposed as components in larger redevelopment projects containing a number of other amenities, as well, including housing and other entertainment attractions. The justification for such developments rests in part on the public goods generated by vibrant, prosperous downtowns. Yet little is known about the value of such downtown public goods. This paper reports the results of two Contingent Valuation Method surveys to determine willingness to pay for new National Hockey League arenas in downtown Edmonton and Calgary in the Canadian province of Alberta. The hypothetical scenarios in both surveys varied to include affordable housing, a casino, and cultural space in addition to the arena. The surveys provide the first estimates of willingness to pay for downtown public goods for sports arenas, and also provide the first estimates of scope effects, that is, the willingness to pay for expansions of public goods, in the sports economics literature. Key Words:

Suggested Citation

  • Bruce K. Johnson & John C. Whitehead & Daniel S. Mason & Gordon J. Walker, 2012. "Willingness to Pay for Downtown Public Goods Generated by Large, Sports-Anchored Development Projects: The CVM Approach," Working Papers 12-01, Department of Economics, Appalachian State University.
    • Handle: RePEc:apl:wpaper:12-01
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    File URL: http://econ.appstate.edu/RePEc/pdf/wp1201.pdf
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    References listed on IDEAS

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    1. Peter A. Groothuis & Bruce K. Johnson & John C. Whitehead, 2004. "Public Funding of Professional Sports Stadiums: Public Choice or Civic Pride?," Eastern Economic Journal, Eastern Economic Association, vol. 30(4), pages 515-526, Fall.
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    3. Bruce K. Johnson & Peter A. Groothuis & John C. Whitehead, 2001. "The Value of Public Goods Generated by a Major League Sports Team," Journal of Sports Economics, , vol. 2(1), pages 6-21, February.
    4. Timothy C. Haab & Kenneth E. McConnell, 2002. "Valuing Environmental and Natural Resources," Books, Edward Elgar Publishing, number 2427.
    5. BK. Johnson & JC. Whitehead, 2000. "Value of public goods from sports stadiums: the CVM approach," Contemporary Economic Policy, Western Economic Association International, vol. 18(1), pages 48-58, January.
    6. Baade, Robert A & Dye, Richard F, 1988. "An Analysis of the Economic Rationale for Public Subsidization of Sports Stadiums," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 22(2), pages 37-47, July.
    7. 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.
    8. Dennis Coates, 2007. "Stadiums And Arenas: Economic Development Or Economic Redistribution?," Contemporary Economic Policy, Western Economic Association International, vol. 25(4), pages 565-577, October.
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    12. John Loomis, 2011. "What'S To Know About Hypothetical Bias In Stated Preference Valuation Studies?," Journal of Economic Surveys, Wiley Blackwell, vol. 25(2), pages 363-370, April.
    13. Ute Lehrer & Jennefer Laidley, 2008. "Old Mega‐Projects Newly Packaged? Waterfront Redevelopment in Toronto," International Journal of Urban and Regional Research, Wiley Blackwell, vol. 32(4), pages 786-803, December.
    14. Paul F. Whiteley (ed.), 1998. "Economic Policy," Books, Edward Elgar Publishing, volume 0, number 996.
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    1. And sometimes I snap
      by John Whitehead in Environmental Economics on 2012-04-23 19:30:51

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    Cited by:

    1. Eric Joseph van Holm, 2019. "Minor stadiums, major effects? Patterns and sources of redevelopment surrounding minor league baseball stadiums," Urban Studies, Urban Studies Journal Limited, vol. 56(4), pages 672-688, March.
    2. Honggang Dong & Brian Yim & James J. Zhang, 2020. "Organizational Structure, Public-Private Relationships, and Operational Performance of Large-Scale Stadiums: Evidence from Local Governments in China," Sustainability, MDPI, vol. 12(19), pages 1-17, September.
    3. Rongrong Zheng & Jiasui Zhan & Luxing Liu & Yanli Ma & Zishuai Wang & Lianhui Xie & Dunchun He, 2019. "Factors and Minimal Subsidy Associated with Tea Farmers’ Willingness to Adopt Ecological Pest Management," Sustainability, MDPI, vol. 11(22), pages 1-12, November.
    4. Fanbin Kong & Kai Xiong & Ning Zhang, 2014. "Determinants of Farmers’ Willingness to Pay and Its Level for Ecological Compensation of Poyang Lake Wetland, China: A Household-Level Survey," Sustainability, MDPI, vol. 6(10), pages 1-15, September.
    5. Jonathan Darkwah Baffoe & Takeshi Mizunoya & Helmut Yabar, 2021. "Determinants of Rice Farmers’ Willingness to Pay for Conservation and Sustainable Use of Swampy Wetlands in Ghana’s Northern and Ashanti Regions," Agriculture, MDPI, vol. 11(6), pages 1-18, May.
    6. Geoffrey Propheter, 2023. "Sports Facilities as a Housing Amenity: Do Prices Follow Facilities?," Journal of Sports Economics, , vol. 24(4), pages 443-474, May.
    7. 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.
    8. Seung Pil Lee, 2022. "The Sports-Based Holistic Development Model: The General Public’s Transformation by Having a Meaningful Story Through Sport," SAGE Open, , vol. 12(4), pages 21582440221, October.
    9. su, chin, 2015. "Estimation of the Willingness to Pay for Preserving the Sports Arenas. The case of Poland," MPRA Paper 74182, University Library of Munich, Germany, revised 2016.
    10. Vörös, Tünde, 2017. "Költség-haszon elemzési keretrendszer sportberuházások társadalmi-gazdasági értékeléséhez [An economic framework for cost-benefit analysis of sports facilities]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(4), pages 394-420.
    11. Bernd Frick & Pamela Wicker, 2018. "The Monetary Value of Having a First Division Bundesliga Team to Local Residents," Schmalenbach Business Review, Springer;Schmalenbach-Gesellschaft, vol. 70(1), pages 63-103, February.
    12. Wiker, Dagmara, 2017. "The valuation of publicly financed sport’s arenas," MPRA Paper 82913, University Library of Munich, Germany.
    13. See, Chan Ken, 2017. "Intangible value in preserving the Sports Arenas," MPRA Paper 81505, University Library of Munich, Germany.
    14. Jones, Benjamin A. & Berrens, Robert P. & Jenkins-Smith, Hank & Silva, Carol & Ripberger, Joe & Carlson, Deven & Gupta, Kuhika & Wehde, Wesley, 2018. "In search of an inclusive approach: Measuring non-market values for the effects of complex dam, hydroelectric and river system operations," Energy Economics, Elsevier, vol. 69(C), pages 225-236.
    15. Pamela Wicker & John C Whitehead & Daniel S Mason & Bruce K Johnson, 2017. "Public support for hosting the Olympic Summer Games in Germany: The CVM approach," Urban Studies, Urban Studies Journal Limited, vol. 54(15), pages 3597-3614, November.
    16. John Charles Bradbury, 2022. "Does hosting a professional sports team benefit the local community? Evidence from property assessments," Economics of Governance, Springer, vol. 23(3), pages 219-252, December.
    17. J. Lucy Lee & Jeffrey D. James, 2015. "Assessing sport brand value through use of the contingent valuation method," Journal of Economic and Financial Studies (JEFS), LAR Center Press, vol. 3(6), pages 33-44, December.
    18. Kansinee Panwanitdumrong & Chung-Ling Chen, 2022. "Are Tourists Willing to Pay for a Marine Litter-Free Coastal Attraction to Achieve Tourism Sustainability? Case Study of Libong Island, Thailand," Sustainability, MDPI, vol. 14(8), pages 1-18, April.
    19. Krystian Zawadzki, 2015. "Estimation Of The Willingness-To-Pay For Preserving The Football Arena In Gdansk," "e-Finanse", University of Information Technology and Management, Institute of Financial Research and Analysis, vol. 11(1), pages 44-55, August.
    20. Funahashi, Hiroaki & Shibli, Simon & Sotiriadou, Popi & Mäkinen, Jarmo & Dijk, Bake & De Bosscher, Veerle, 2020. "Valuing elite sport success using the contingent valuation method: A transnational study," Sport Management Review, Elsevier, vol. 23(3), pages 548-562.
    21. Michael Spanbauer & Lindsay Johnson & Patrick Button, 2017. "How Valuable are National Parks? Evidence from a Proposed National Park Expansion in Alaska," Working Papers 1707, Tulane University, Department of Economics, revised Mar 2018.
    22. Stephanie F. Stefanski & Jay P. Shimshack, 2016. "Valuing Marine Biodiversity in the Gulf of Mexico: Evidence from the Proposed Boundary Expansion of the Flower Garden Banks National Marine Sanctuary," Marine Resource Economics, University of Chicago Press, vol. 31(2), pages 211-232.
    23. Robert, Ruszkowski, 2017. "The Contingent Valuation Method in assessing the value of sport’s stadium in developing nations. The case of Poland," MPRA Paper 80581, University Library of Munich, Germany.

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