Journal of Economic Perspectives: Vol. 14 No. 3 (Summer 2000)


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The Economics of Sports Facilities and Their Communities

Article Citation

Siegfried, John J., and Andrew Zimbalist. 2000. "The Economics of Sports Facilities and Their Communities." Journal of Economic Perspectives, 14(3): 95-114.

DOI: 10.1257/jep.14.3.95


Since the 1950s, taxpayers have been the primary investors in stadia built for the use of privately-owned professional sports teams. Team owners have argued that sports facilities boost local economic activity; however, economic reasoning and empirical evidence suggest the opposite. Public support for stadia is also driven by demand for community image, and owners of sports teams supply a scarce input into image enhancement--participation in the major league--for which they have been able to extract monopoly rents from dispersed taxpayers. We suggest reforms to dissipate the monopoly sports leagues exercise when negotiating with host communities for their teams.

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Siegfried, John J. (Vanderbilt U)
Zimbalist, Andrew (Smith College)

JEL Classifications

R53: Public Facility Location Analysis; Public Investment and Capital Stock
L83: Sports; Gambling; Recreation; Tourism


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