16.3.14

JUST IN TIME FOR MARCH MADNESS.

A reality check on the economic consequences of the Super Bowl.
As Holy Cross professor Victor Matheson, another economist who's studied Super Bowl impact, puts it, "Imagine an airplane landing at an airport and everyone gets out and gives each other a million bucks, then gets back on the plane. That's $200 million in economic activity, but it's not any benefit to the local economy."
It's true that the airport gets to collect some landing fees, and the airport concessions might sell a few martinis to lubricate the deals, but the presence of an airport suggests that if that plane doesn't land, some other plane might.  The reverse proposition is also valid.
Then there's the issue of displacement. When hordes of Super Bowl visitors descend on a city's hotel rooms, that fills up all the hotel rooms, which means -- wait for it -- no more hotel rooms for anyone else. So people who might have visited New Orleans otherwise are forced to steer clear. (The NFL study tried to account for this by subtracting out New Orleans' lost convention business, but as you may be aware, there are other reasons to visit New Orleans in the winter other than for a convention.) In fact, because Super Bowl rooms are often required to be rented by the week but many visitors only show up for the game weekend, some economists have suggested that all those incoming NFL fans only end up displacing people who would have spent more, on average, during their time in town.
So let it be with the basketball tournament.  I wonder if this year's tournament, which is scheduling games closer to the campuses of higher-seeded teams, is catching on.

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