Professional Sporting Events and Firm-Level Economic Activity

26 Pages Posted: 7 Oct 2016

See all articles by Craig A. Depken

Craig A. Depken

University of North Carolina at Charlotte - The Belk College of Business Administration - Department of Economics

Benjamin Fore

Bank of America

Date Written: October 2016

Abstract

This paper investigates the impact of professional sporting events on the daily revenue of a particular restaurant in Charlotte, NC. The daily data allow us to test for the impact of professional basketball and professional football games on daily revenues. For this particular firm, professional football games are associated with a net increase in daily revenues, regardless of game outcome; professional basketball games are not associated with increases in daily revenues. Using betting markets as a proxy for market expectations of game outcomes, the data suggest that NFL fans in Charlotte spend more after NFL home games regardless of outcome and regardless of expectations but that they spend less after unexpected losses on the road. This suggests that NFL fans reflect celebratory effects of home games and sore-loser effects of unexpected losses. In contrast, NBA fans reflect only sore-loser effects after unexpected losses at home. The mixed impacts of game outcomes on firm-level revenue suggest that mixed results using aggregate data might be partly caused by the outcomes of events.

Keywords: sports, economic impacts, sports subsidies, tourism

JEL Classification: L83, Z20

Suggested Citation

Depken, Craig A. and Fore, Benjamin, Professional Sporting Events and Firm-Level Economic Activity (October 2016). Available at SSRN: https://ssrn.com/abstract=2847702 or http://dx.doi.org/10.2139/ssrn.2847702

Craig A. Depken (Contact Author)

University of North Carolina at Charlotte - The Belk College of Business Administration - Department of Economics ( email )

Charlotte, NC 28223
United States

Benjamin Fore

Bank of America ( email )

100 North Tryon Street
6th Floor
Charlotte, NC 28255
United States

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