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Sports and Regional Growth in Sweden - Is a successful professional sports team good for regional economic growth?

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  • Värja, Emelie

    () (Örebro University School of Business)

Abstract

This study investigates whether net inbound migration and per capita income growth of a municipality is affected when a local sports team enters or exits the premium national leagues in ice hockey or soccer in Sweden. Local governments frequently support a local professional team through direct subsidies; beneficial funding of arenas, etc., which often is motivated by alleged, positive externalities through effects on the attractiveness of the municipality as a leisure-travel destination, or place for living or doing business, which ultimately is supposed to enhance the tax base and the tax revenues of the local government. Previous literature on such effects is based on simple models estimated on a selected sample of cities and without consideration of spatial interdependencies between local areas. We carry out a simultaneous estimation of spatial paneldata models of income per capita growth and net migration rates using annual data from all Swedish municipalities from 1995-2011 (except for four municipalit that have changed borders). With this richer modeling framework we still find no evidence of a positive relationship from performance of a local team on any of these two variables.

Suggested Citation

  • Värja, Emelie, 2014. "Sports and Regional Growth in Sweden - Is a successful professional sports team good for regional economic growth?," Working Papers 2014:3, Örebro University, School of Business.
  • Handle: RePEc:hhs:oruesi:2014_003
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    More about this item

    Keywords

    sports; growth; spatial econometrics; regional growth;

    JEL classification:

    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
    • J61 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Geographic Labor Mobility; Immigrant Workers
    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism

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