Professional sports as economic activity magnets: Some evidence from employment microdata

Abstract

ABSTRACTProponents of subsidies for professional sports argue that new sports facilities can revitalize neighborhoods, because they attract large crowds of people and thereby act as magnets of economic activity. The existing literature on sports and economic development does not falsify the economic activity magnet hypothesis, however. This study offers a test of the magnet hypothesis using employment microdata for establishments within the vicinity of a Major League Soccer stadium in Commerce City, Colorado. No evidence is found that the construction of the stadium is associated with increased economic activity in its vicinity measurable in terms of jobs, nor is there any evidence that the franchise’s relocation is associated with job losses at establishments closer to its prior home compared to further away.