Sports Stadiums and Area Development: A Critical Review

Should local governments subsidize the construction and operation of sports stadiums? This is being debated in cities throughout North America, and several factors have conspired to elevate this issue to headline status. Local government officials, burdened by the deteriorating financial health of their cities, have sought ways to mollify critics. Since some political strategists have argued that the presence of professional sports imparts economic prosperity, some local political leaders have hitched their wagons to the sports star. But is professional sports a panacea for sagging urban economic fortunes? Many are skeptical that subsidizing sports stadiums is worth the costs. We examine published and unpublished literature as well as our own research to chronicle, analyze, and critique the use of publicly financed sports stadiums as a vehicle for economic progress. We provide information for both the academic and the practitioner on the types of questions that should be posed when making decisions about stadiums. In the first section we detail and analyze the recent history and future plans for city financial involvement in sports stadium projects. We discuss the costs and benefits of stadium-based development rationale in the second section, and the next section analyzes its validity. Factors that may prove decisive in determining the economic successfulness of an individual stadium project are observed in the fourth section, and the last section concludes the article.