NBC Chicago’s politics blog “The Ward Room” recently posted an opinion piece affirming Mayor Rahm Emanuel’s decision to refuse to provide public money for a $500 million renovation of Wrigley Field. The writer, Edward McClelland, cited research by UMBC economics professor Dennis Coates that found pro sports reduce a city’s per capita income by putting entertainment dollars into the hands of athletes and team owners who live outside the area rather than local businesses around the stadium.
Coates wrote, “money paid to players does not circulate as widely or abundantly as it would were it paid to people with less wealth and more attachment to the city.” Read the article to learn more.
A new Bloomberg Businessweek article sheds light on tax subsidies that benefit college athletic programs, including hundreds of millions in funding for stadium construction and sports departments’ exemptions from taxes on ticket, television and other income generated by their stadiums.
UMBC’s Dennis Coates, professor of economics, argues that college sports may not be the best use of tax exemptions. “When one thinks of charity, they don’t think of charity flowing to the head football coach of a big state university.” Questioning municipal financing for stadiums Coates notes, “Using the borrowing power of the state and tax-exempt interest to build stadiums for sporting events isn’t the real purpose of the university, either.”
A new Sports On Earth commentary by Patrick Hruby quotes UMBC professor Dennis Coates, economics, in arguing that eliminating “sports welfare” among college and professional sports teams and owners would provide an “easy, overdue fix to the nation’s fiscal woes.”
Coates believes more money would be available to indebted cities with professional teams and stadiums if athletes kept their money in the communities where they play, instead of the southern California or south Florida areas where they often live. “If that same money was spent on a movie, dinner, bowling, the theater, a locally-owned bar, tips for bartenders and waitresses, all of that money predominantly stays within that community,” says Coates.
Coates also commented in the Baltimore Sun on the Colonial Athletic Association’s decision to award Baltimore’s 1st Mariner Arena the men’s basketball conference tournament for 2014-2016. Coates thinks it’s too soon to tell how the tournament will fare in Baltimore, but speculates that the city could lose money putting on the tournament instead of turning a profit.
The New York Times Economix blog today explored the possible impact of the Giants’ Super Bowl victory on the New York economy, referencing a study coauthored by UMBC economics professor Dennis Coates. Reporter Catherine Rampell calls Coates’ study, “The Economic Impact of Postseason Play in Professional Sports,” the “godfather” of this area of research. Curious about the results? Check out the story.