Responding to pressure from lawmakers, Missouri state officials have created an official government task force seeking to entice the National Football League (NFL) to select Kansas City as the host city for a future Super Bowl championship game.
However, the creation of the government task force, seeking to lure such an event to Arrowhead Stadium, raises an important question: does hosting the Super Bowl have a positive net economic impact on a host city? The answer is, “it can, but it probably won’t.”
In their 2009 study entitled “A Winning Proposition: The Economic Impact of Successful NFL Franchises,” Missouri University of Science and Technology economics professor Michael C. Davis and Xavier University psychology professor Christian M. End found that hosting a Super Bowl has no economic impact on a city’s real per-capita income — and in some cases it can have a negative effect.
During that period, three cities — Tampa Bay, Miami, and Jacksonville — hosted the Super Bowl, a total of seven times. Within the scope of the study, hosting the Super Bowl had a statistically significant positive impact on the city’s economy in a single instance —Tampa Bay in 2001.
Additionally, in a separate 2006 study, University economist Dennis Coates found that Houston saw increased sales tax revenue, due to the Super Bowl in 2004. However, in the next year in Jacksonville, the Super Bowl was found not to have had an economic impact.
This takes us back to the Kansas City Super Bowl task force. Why is the state in the business of trying to lure the Super Bowl to Kansas City? Couldn’t a private group of interested residents and businesses sell the city as a Super Bowl destination just as well?
Possibly, but the state can offer the NFL subsidies. However, just because the state can do something, doesn’t mean it should.
To quote Coates’ findings, economists generally oppose sports subsidies because “the large and growing peer-reviewed economics literature on the economic impacts of stadiums, arenas, sports franchises, and sport mega-events has consistently found no substantial evidence of increased jobs, incomes, or tax revenues for a community associated with any of these things.”
It’s true that there could be intangible benefits to hosting a Super Bowl, like increased exposure to the outside world. Yet, is there any concrete measure on what kind of return the city would see from such exposure? Will businesses or residents move to Kansas City because it hosted the Super Bowl?
The burden of proof should be on those arguing for government subsidies.
Michael Rathbone ([email protected]) is Policy Director for the Show-Me Institute, based in Saint Louis, Missouri. Used with permission from the Show-Me Institute, http://www.showmeinstitute.org/
“A Winning Proposition: The Economic Impact of Successful NFL Franchises,” Michael C. Davis, Missouri University of Science and Technology: http://heartland.org/policy-documents/winning-proposition-economic-impact-successful-nfl-franchises