NEW SPORTS ARENA

The Economic Impact of a New Sports Arena in Detroit

Abstract

Back to the day people went to the ballpark to go watched a baseball game but now that just is not enough. Now when we go to watch a game people go there to have an experience of some kind. The new ballparks are not being built for the players but for the fans that know very little about the game at hand. I think that Jack Rouse said it best when he stated "Baseball is sure, not about nine guys on a field anymore. If we are going to hook people on baseball, we don't do it by making them sit through nine innings. If we can make the experience more pleasurable, we should." I think this really says something about the game today. Some of the newer ballparks today has added some “theme park” like attractions. Some of these include play sets for kids or some even have arcades in them. At U.S. Cellular Field for every game, they offer a speed pitch machine, two arcades, and an obstacle course. In addition, they have some special game days where they will have different activities for people who don't know that much about baseball and want to enjoy the experience of the ballpark. In this paper, we try to focus on the economic impact of a new sports arena in Detroit. In this paper, we identify through economic principles and the economic impact in building a new sport arena in Detroit. The paper covers the advantages and disadvantages in having a new arena in Detroit. We research through secondary sources, and come to conclude the overall impact on the economy due to the opening of a new arena in Detroit.

The economic impact of a new sports arena in Detroit

Introduction

Advocates for subsidies include the diehard fans, like me, the players and the owners looking to make a larger profit. They argue that building a new stadium creates construction jobs, generates new spending in the community by people who attend games or work for the team and the venue attracts tourists and companies to the host city. All this new spending has a “multiplier effect” as the additional local income leads to more new spending and job creation. These all seem like reasonable justifications for building a new stadium.

Discussion

Assuming that consumers have a fixed leisure budget, when a sports team moves to a city like Detroit from Pontiac, the money that a family spends going to a Lion's game is typically money that would have been spent on other leisure activities like bowling or go to the movies. Consider the possibility of the Lions having a stellar season. If they attract fans from outside of their own metropolitan area, which otherwise wouldn't have come to the game or spent money at restaurants in Detroit, then they are adding revenue to the mix that wouldn't have normally been spent (Roche, 2000).

Opportunity cost is a major issue when it comes to public ...