|Stadiums are Good for Making Your Home More Expensive, but Not for Helping People Find Work|
|Subject||New Stadium Construction Increases Property Values|
|Topic||Supply and Demand|
Property Taxes, Cost, Benefits, Property Values, Rent
Economists have tried repeatedly to justify or refute politicians' claims that building new sports stadiums will positively affect jobs, tourism, and local economic growth. However, they have never been successful. They have, however, found a positive relationship between sports stadiums and the cost of housing in the area surrounding such stadiums.
Using statistical analysis, two economists, Edward Coulson and Gerald
Carlino, examined rents in 53 cities during the 1990s, including Houston,
Dallas, St. Louis, Philadelphia, Memphis, and others. The economists found
that rents in central-city areas where stadiums were located were 8% higher.
In fact, each resident of a city with a National Football League team
paid an additional $184 annually for the privilege of living there. Since
higher rents imply higher property values, property tax receipts increase.
Government revenues from property taxes were, on average, approximately
$50 million higher in 1999 in NFL cities than in other cities. Given that
governments rely on property taxes to finance a number of local goods,
such as police, fire prevention, and public education, everyone in the
city benefits as a result. In fact, they were able to use this information
to explain trends in football franchise locations. For example, a few
years ago, "the Houston Oilers moved to Tennessee and morphed into
the Titans. But Dallas retained its iconic Cowboys. By 1999, rents in
Dallas had risen about 37 percent while rents in Houston had grown more
slowly, about 22 percent."
(Updated July, 2004)
|Source||Daniel Gross. "A Team Makes a City a High-Rent District." The New York Times. 2 May 2004..|
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