Locating Major League Stadiums Where They Can Make a Difference

Abstract

The louder policy analysts complain about using public resources to subsidize the construction of new major league sports stadiums, the more subsidies are made, despite empirical evidence showing that public investments in stadiums to lure or keep major league teams have considerable opportunity costs. Policy analysts should consider shifting the emphasis of their work to evaluate where building stadiums would minimize opportunity costs or maximize economic interactions among locations. This article uses time-series analysis of 25 metropolitan areas to show that in terms of capturing share of economic activity, the best location for professional sports stadiums appears to be the downtown (including the central business district and nearby “edge” areas), followed by other locations in the central city. Suburban locations appear to be associated with the least amount of economic activity. This analysis has broad implications for all major public investments aimed at attracting people to sports, recreation, culture, and public assembly venues.

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