Sunday, November 18, 2018

Stadiums as Public Goods

It is very common for professional sports stadiums to be at least partially funded by taxpayers and the local government.The proponents of this funding argue that stadiums generate jobs as well as income for the area by attracting fans for sporting events and concerts who will in turn support local businesses around the stadiums. Is the decision by local governments to treat these stadiums as public goods  a reasonable choice?

Looking at the two basic characteristics of a public good, it is easy to see that stadiums are definitely not purely public. Every event I have ever been to at a stadium has required a ticket in order to enter the stadium. If you don't have a ticket there is no easy way to get in. This clearly shows that stadiums are excludable. When it comes to whether or not stadiums are non rivalrous it is a little bit trickier. Generally one extra fan watching a game or concert with me does not affect my experience. As the number of other people consuming the event with me increases, however, at some point it starts to negatively affect me when I can no longer see or get a seat. In addition to not satisfying either the non-excludability or the non-rivalry requirements to be deemed a public good, I believe the other arguments for public funding of stadiums are also overstated. Many of the jobs they generate are jobs such as ushers and concession workers at events. These jobs work far less than 40 hours a week and are rarely enough to support someone by themselves. The other benefits that these events bring are largely given directly to the sports team or owners of the stadium and not redirected into the local economy. Fans often spend their money on concessions and at the team store, not in local restaurants and shops as the proponents of the funding would have you believe. The events at the stadium also almost always require increased spending on police for traffic and crowd control as well as increased public transportation. These costs further decrease the benefit of the stadium to the local economy and add even more reasons why I don't believe these stadiums should be treated as a public good.

No comments: