Why Does Local Media So Often Ignore Research On Stadium Economics?


A new study from two professors in Pennsylvania shows that the Pocono Raceway, the central Pennsylvania track that hosts two NASCAR events each summer, provides a major boost to the local economy every year. Gov. Tom Corbett (R), like any politician would, wants to tell you about that study, and the Pocono Record was glad to oblige:

The governor joined raceway officials and several legislators in revealing that an economic impact analysis conducted by two East Stroudsburg University professors showed that Pocono Raceway generated $257.5 million last year and they project it will generate more than $277 million this year.

“It’s igniting economic opportunities for the communities surrounding the racetrack and the three big race weekends there are the equivalent of hosting the Super Bowl in Pennsylvania every year,” said Corbett, who was admittedly tempted to defy his state troopers and hop inside the one racecar parked outside and go for a spin.

I’m not all that interested in disputing the numbers — though I’ll be frank about the fact that I don’t believe them on first glance — because this isn’t actually about those numbers or this race track, because the numbers in this instance were used only to justify a public expenditure that appears relatively benign compared to most other instances. But I am interested in why stories like this keep popping up in the local media, especially because the Record wasn’t alone on this story. There’s plenty of academic research disputing the idea that stadiums and sporting events are this good for the local economy, and the rule of thumb from sports economists is that the actual impact is generally about 10 percent of what promoters and impact studies like these say. And yet, even as that research has made its way into the national media and the broader discussion about stadiums, it often fails to end up in local stories. Whether we’re talking about the NCAA Tournament, the Super Bowl, or a run-of-the-mill stadium construction project, local stories often focus on how great these events or facilities will be for the economy with no mention of the research showing otherwise.

I don’t know why that happens, but I have an idea: it makes, I suppose, intuitive sense that these projects are good for the economy. People are coming to town and spending money, after all. But even if they don’t, a lot of people want to believe that these projects are worth the money we spend on them, that we’re not throwing hundreds of millions of good dollars away for far less (economically) in return. I guess it’s also easy enough to believe that if they were such bad deals cities and states would stop approving them. Throw in an academic study and a governor to tout it and it all looks legitimate enough to stave off any thought about the numbers not being true at all.

That’s an understandable instinct for the average Joe in the community who wants to keep his favorite team or attract a sporting event to his city and is thus predisposed to believe these numbers add up. And it’s understandable for politicians, franchise owners, and sports promoters too, because citing these studies makes publicly-financed stadium deals that are much bigger than spending $5 million on a few roads, as Corbett plans to do near Pocono, easier to sell to the public. But that instinct doesn’t cut it for media outlets, which have an obligation to provide the full story, especially because these studies are so often used to justify new public-financing projects. This isn’t meant to pile on the Pocono Record reporter who had to write that brief, because this happens all the time. But given that the research about stadium economics is readily available and that there’s a clear economic consensus around it, there’s not really a good excuse for producing a news story that leaves it out altogether.