Robert A. Baade, Victor A. Matheson
AIES-IASE, Working Paper Series, Paper No. 11-02, January 2011
This paper examines public financing of professional sports facilities with a focus on both early and recent developments in taxpayer subsidization of spectator sports. The paper explores both the magnitude and the sources of public funding for professional sports facilities.
Improving citizens’ quality of life is clearly an important goal for public policy makers, and there is evidence that sports are a valued amenity for local communities. Evidence of significant direct economic benefits from sporting events, franchises, and stadiums is lacking, however. While public-private partnerships can be justified on quality of life grounds, voters and public officials should not be deluded by over-optimistic predictions of a financial windfall. Sports may make a city happy, but they are unlikely to make a city rich.