7/5/2012: At some point in the next few years the UO athletic department will announce plans for an expansion of Autzen stadium and Hayward field. We can expect that they will argue that sports has spillover economic benefits for Eugene. This is a dubious idea theoretically, since when people spend more on sports they spend less on other things. And it is not supported by the evidence. From a paper on NFL stadiums by the economist Kurt Rothoff:
Public subsidies for professional sports stadiums are often used as a means to stimulate economic development in local communities. Economic impact studies, as well as the politicians pushing them, claim that stadiums will induce job creation and revenue expansion. Using data on metropolitan statistical areas, academics find little to support the claims that stadiums help create jobs and increase the income in the local economy. This paper adds to the current literature by using detailed county level data to analyze the effect of a stadium on a smaller area around the stadium.
This study finds that employment within these industries (clothing, drinking, food, hotel, and liquor) have mixed results when a franchise is present, this is consistent with Coates and Humphrey’s (2003). However, although most of the payroll data is insignificant, the coefficients that are significant are all negative. This also supports Coates and Humphrey’s (2003) findings that real per capita income falls when sports franchises are present.