The Growth Effects of Sport Franchises, Stadia and Arenas

UMBC Dept. of Economics Working Paper #97-02

23 Pages Posted: 29 Sep 1997

See all articles by Dennis Coates

Dennis Coates

University of Maryland, Baltimore County

Brad R. Humphreys

West Virginia University - Department of Economics

Date Written: September 16, 1997

Abstract

This paper investigates the relationship between professional sports franchises and venues and real per capita personal income in 37 Standard Metropolitan Statistical Areas in the United States over the period 1969-1994. Our empirical framework accounts for the entry and departure of professional football, basketball and baseball franchises; the construction of arenas and stadia; and other sports-related factors over this time period. In contrast to other existing studies, we find evidence that some professional sports franchises reduce the level of per capita personal income in metropolitan areas and have no effect on the growth in per capita income, casting doubt on the ability of a new sports franchise or facility to spur economic growth. We also find evidence that results obtained from estimating reduced form relationships, a common practice in the literature, are not robust to alternative statistical model specifications.

JEL Classification: R58, O18, H70

Suggested Citation

Coates, Dennis and Humphreys, Brad R., The Growth Effects of Sport Franchises, Stadia and Arenas (September 16, 1997). UMBC Dept. of Economics Working Paper #97-02. Available at SSRN: https://ssrn.com/abstract=33240 or http://dx.doi.org/10.2139/ssrn.33240

Dennis Coates (Contact Author)

University of Maryland, Baltimore County ( email )

1000 Hilltop Circle
Baltimore, MD 21250
United States
410-455-3243 (Phone)
410-455-1054 (Fax)

Brad R. Humphreys

West Virginia University - Department of Economics ( email )

Morgantown, WV 26506
United States

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