Before 1950, most sports teams played in the private stadiums and arenas in the United States. The emergence of public stadiums and arenas after 1950s has compelled the state and local governments to fund entire sports projects or subsidize their construction in various cities. A number of studies have indicated that state and local governments use massive funds in the construction of stadiums on the premise that they boost economic growth and generate civic pride. Sports teams alone are unable to construct stadiums and arenas because bankruptcy usually threatens their existence in cities that do not support them. According to Goothius, Johnson, and Whitehead (2004), the Pirates baseball team, the Steers football team, and the Penguin hockey team threatened to vacate Pittsburgh if the state and local governments did not allocate sufficient funds for the construction of necessary stadiums. Therefore, it is critical to establish if governments spend enormous funds in the construction of stadiums for civic pride or public choice.
The study is significant because it seeks to answer why state and local governments spend a great deal of funds in the construction of stadiums. Governments normally justify public funding of stadiums with the assertion that sports produce positive externalities such as increased economic activity, as supported by the use benefit hypothesis, and civic pride, as supported by the nonuse benefit hypothesis (Goothius, Johnson, & Whitehead, 2004). The case study of Pittsburgh is very significant because it illustrates the forces that compel governments to use public funds in the construction of stadiums. As public funding is an issue in the construction of stadiums, the study is important in sensitizing the public regarding the positive externalities that sports generate for the city and the general population.
The study employed survey as the methodology of collecting opinions of respondents in Pittsburgh. Specifically, the study administered contingency valuation surveys to 293 households in Pittsburgh. As the study targeted respondents in Pittsburgh only, the research design employed is a case study. The questions of the survey focused on the support for public funding, consumption of hockey as a sport, willingness to pay taxes, hypothetical scenario of the Penguins leaving Pittsburgh, and willingness to own the penguins at the expense of public funds.
The findings indicate that generation of civic pride is the major reason why fans of teams such as the Steelers, the Pirates, and the Penguin do support the construction of sports amenities using public funds. Comparative analysis of the proponents and the opponents of the use of public funds in the construction of stadiums indicates that 20% of the opponents supported the use of public funds in the purchase of the Penguin hockey team, whereas 73% of the proponents supported ownership of the Penguin hockey team using public funds. In general, the findings indicate that although a minority of respondents does not support the use public funds in the construction of sports amenities in Pittsburgh, a majority of respondents holds that sports produce civic pride.
The article gives background of the study, which effectively illustrates the problem statement as the determination of the benefits of sports amenities financed with public funds. Given that governments justify public funding of sports amenities with positive externalities such as use benefits and nonuse benefits, examination of teams and stadiums in Pittsburgh as the case study gives an empirical analysis of the benefits of sports to warrant public financing. In essence, the case study enhances external validity of the findings by making them generalizable to any state and city in the United States. Moreover, the use of contingent valuation survey in the collection of data offers a reliable and valid data, which other researchers can reproduce. The descriptive analysis of data in this study is reliable because it quantifies the support that people gives to the public funding of teams and stadiums. Ultimately, the authors of the article are notable economists, and thus, their study presents credible information.
Reference
Goothius, P., Johnson, B., & Whitehead, J. (2004). Public Funding of Professional Sports Stadiums: Public Choice or Civic Pride. Eastern Economic Journal, 30(4), 515-526.