Impact of Professional Sports in Impact of Professional Sports in Surrounding Metropolitan AreasSurrounding Metropolitan Areas

Terri Ekin

Lucy Morales

Mark Morales

PAF 502: Public Service Research II

IntroductionIntroduction

Research Question– Hypothesis

Does a professional sports team’s presence improve the economic well being or quality of life of people in a surrounding metropolitan area?

Significance of Research Question– Studies have been made to suggest that a sports stadium

facility does not improve the economic well being of people in a surrounding area.

Theories to Formulate Basis Theories to Formulate Basis of Hypothesisof Hypothesis

A large corporation will greatly benefit its community by the economic multiplier effect.

A professional sports team is a large corporation. A sports team will benefit its community

economically.

Public Policy IssuesPublic Policy Issues Government-subsidized industry

– Historian W. G. Hardy. Intangible benefits

– Quality of life issues Hefty price tag

Economic benefit studies – Heartland Institute Study

Opportunity costs Shifting current spending Subsidies leave the

community

Our HypothesisOur Hypothesis

Professional sports teams are not, by themselves, a significant influence on certain measurable economic and quality of life issues.

Our HypothesisOur Hypothesis

Professional sports teams are not, by themselves, a significant influence on certain measurable economic and quality of life issues.

Discussion of Data Discussion of Data MeasurementMeasurement

Data Collection MethodsMajor League BaseballNational Football LeagueFed Stats

– US Census Bureau– Bureau of Labor Statistics– Bureau of Justice Statistics

http://www.census.gov

Census BureauCensus Bureau

http://www.fedstats.gov

Bureau of Labor StatisticsBureau of Labor Statistics

Data ElementsData Elements

Population from 2000 US Census for Metropolitan Statistical Areas (n= 280)

MLB or NFL? How many stadiums? Per-Capita income? Percent of

– Women over 25 with post HS degree– Population with inc. below nat’l poverty rate– Households paying > 30% income in rent

More Data ElementsMore Data Elements

Per-Capita income?Percent of

– Women over 25 with post HS degree– Population with inc. below nat’l poverty rate– Households paying > 30% income in rent

More Data ElementsMore Data Elements

• Percent of working people >16 yrs working at home.--whose commute is < 30 minutes-- whose commute is >90 minutes

• Percent unemployment for 2000• For 51 MSA’s, the homicide rate for CY

1999

  Research FindingsResearch Findings

Statistical TablesDiscussion

Descriptive StatisticsDescriptive Statistics

N Minimum Maximum MeanStd. Deviation

HaveSprt 280 0 1 0.09 0.291Popn2K 280 57813 21199865 818545.8 1957795.95PercFem25olABMPD 280 0.15 0.56 0.2858 0.07074PercapIncome 280 6378 31195 19663.57 3355.856PercentPov 280 0.05 0.57 0.1346 0.06361PercWkHome 280 0.01 0.07 0.0293 0.00894PercCommUpTo30min 280 0.49 0.91 0.7532 0.08378PercCommOvr90min 280 0.01 0.07 0.0212 0.00899PercGr30ofInc 280 0.23 0.56 0.3629 0.05148AnnRateUnEmp2000 280 1.2 27.4 4.2675 2.67085Valid N (listwise) 280

Correlation Table – Factor AnalysisCorrelation Table – Factor Analysis

Population Have Sport

Perc Fem with

DegreePer Capita

Income

Percent below

Poverty Rate

Population 1 0.665 0.178 0.358 -0.075Have Sport 0.665 1 0.183 0.383 -0.144

Perc Fem with Degree 0.178 0.183 1 0.566 -0.238

Per Capita Income 0.358 0.383 0.566 1 -0.756

Percent below Poverty Rate -0.075 -0.144 -0.238 -0.756 1

Percent Work at Home 0.062 0.071 0.518 0.398 -0.297

Percent with Commute Less

than 30 min -0.579 -0.537 -0.026 -0.259 -0.093

Percent with Commute Greater

than 90 min 0.303 0.132 -0.264 -0.192 0.307

Percent who Pay more than 30% of income for Rent 0.088 0.05 0.449 0.116 0.133

Annual Rate of Unemployment -0.038 -0.093 -0.471 -0.569 0.602

Correlation Table – Factor AnalysisCorrelation Table – Factor Analysis

Percent Work at Home

Percent with Commute

Less than 30 min

Percent with Commute

Greater than 90 min

Percent who Pay

more than 30% of income for Rent

Annual Rate of Unemployment

Population 0.062 -0.579 0.303 0.088 -0.038Have Sport 0.071 -0.537 0.132 0.05 -0.093Perc Fem

with Degree 0.518 -0.026 -0.264 0.449 -0.471Per Capita

Income 0.398 -0.259 -0.192 0.116 -0.569Percent below

Poverty Rate -0.297 -0.093 0.307 0.133 0.602

Percent Work at Home 1 0.076 -0.1 0.374 -0.189

Percent with Commute

Less than 30 min 0.076 1 -0.447 -0.033 -0.083

Percent with Commute

Greater than 90 min -0.1 -0.447 1 0.045 0.379

Percent who Pay more

than 30% of income for

Rent 0.374 -0.033 0.045 1 -0.026Annual Rate

of Unemployme

nt -0.189 -0.083 0.379 -0.026 1

ComponentsComponents

1 2 3

Popn2K-0.08 0.857 0.093

HaveSprt-0.196 0.8 0.053

PercFem25olABMPD

-0.418 0.086 0.754PercapIncome

-0.792 0.377 0.298PercentPov

0.887 -0.039 0.015PercWkHome

-0.252 -0.017 0.73PercCommUpTo30min

-0.108 -0.849 0.029PercCommOvr90min

0.543 0.51 -0.063PercGr30ofInc

0.208 0.038 0.846AnnRateUnEmp2000

0.804 0.042 -0.15

Extraction Method: Principal Component Analysis. Rotation Method: Varimax with Kaiser Normalization.

Component

Scree Plot

Component Number

10987654321

Eig

en

valu

e3.5

3.0

2.5

2.0

1.5

1.0

.5

0.0

Top Fifty Cities with the Top Fifty Cities with the number of their teamsnumber of their teams

0

500

1000

1500

2000

2500

0 5 10 15 20 25 30 35 40 45 50

0

1

2

3

4

5

6

7

rank

area_name

Popn2000-10k

Population in 10,000's

Total Of Team

MLB Baseball

NBA Basketball

NFL Football

AmenitiesAmenities

Important Issues for communities and the public– “Being on the map…”– Having an identity

Stadium as one part of a community amenity package– others: public services,

infrastructure, culture/arts, diversity, climate, etc.

Economic Questions to AskEconomic Questions to Ask Does a stadium promote the general

economic development of a metropolitan area?

Can it assist in maintaining the vitality of the central city?

Can it stimulate development? Studies researched say NO

– I.e. - Bank One Ballpark - $230 million projected to create 400 jobs It would cost only $700,000 per job

ConclusionConclusion In spite of many studies failing to show positive

economic benefits of stadia, communities still strive to keep and attract professional sports teams.– Major sports leagues act as monopolies– Cities enter into bidding wars to attract teams– Cities will continue to attract and retain major

league sports based on perceived benefits

•Price of a New Stadium: $400 millionPrice of a New Stadium: $400 million

•Price of a New Quarterback: $50 millionPrice of a New Quarterback: $50 million

•Price of a Hot Dog and Beer: $20Price of a Hot Dog and Beer: $20

•Having the Cardinals in your Hometown: PRICELESS!!!Having the Cardinals in your Hometown: PRICELESS!!!

Discussion of Research Limitations and Discussion of Research Limitations and Possible Future EffortsPossible Future Efforts

– Large metropolitan areas are very complex, making quantifying particular influences difficult.

– Small scale – Design a questionnaire focused on perceived benefits of sports team, covering a random sample of people (public) from all parts of the economic spectrum (possibly based on income)

This questionnaire could give more insight into quality of life indicators

ReferencesReferences

Edward I. Sidlow and Beth M. Henschen, “Building Balparks: The Public-Policy Dimensions of Keeping the Game in Town”, in The Economics and Politics of Sports Facilities, Edited by Wilbur C. Rich (Quorum Books, Westport, CT) 2000

“Sports Stadium Madness – Why it started – How to stop it” by Joseph L. Bast, The Heartland Institute 1, http://www.lpwi.org/newsletter/00news/00janfeb/six.html

W.G. Hardy, http://www.mackinac.org/images.asp?id=4131

David Swindell and Mark S. Rosentraub, “Who Benefits from the Presence of Professional Sports Teams? The Implications for Public Funding of Stadiums and Arenas,” Public Administration Review, Jan/Feb, Vol. 58, No. 1, pp. 11-20, 1998