Page Outline
An Economic Basis || A Question of Scale
A Question of Ownership || Sports Stadia and Locational Research
Bottom of the Page

An Economic Basis for the Study of the Location of Sports Facilities

As I hope to have made abundantly clear, little is known concerning the location of sports stadia in metropolitan areas in North America or elsewhere. Most research into stadia has instead relied upon an economic perspective of these special activity generators. These studies have focused upon the profitability of a stadium for a city (Baim), studies of minor league baseball and its effects upon small towns (Johnson), and case studies and a general review of the stadia debate (Euchner). These pieces have primarily served to enlighten and spark the debate in the academic realm, yet few politicians are aware of or subscribe to the conclusion these books reach.

Dean Baim'’s dissertation turned book The Sports Stadium as a Municipal Investment (1994) investigated whether or not sports stadia resulted in a profit in fifteen American cities. He discovered that only one stadium, Dodger Stadium in Los Angeles, resulted in a net return for the government. The remaining fourteen operated at a loss over the various periods studied. Despite this finding, Baim is cautious in concluding that stadia are poor investments because his research was aimed primarily at determining direct costs and benefits. In his analysis, Baim did not consider indirect benefits accruing to a city from increased economic activity in an area. Similarly, he also did not factor in costs accruing from increased congestion near stadia or indirect infrastructure or service costs.

In his book, Playing the Field (1993) Charler Euchner reaches the conclusion that Baim seemed reticent to make: that publicly financed stadia are bad investments. Euchner suggests that, unless teams are willing to finance a significantly greater proportion of the costs for new stadia, then the city will certainly end up an economic loser. Euchner summarily dismisses all of the talk of indirect benefits and the economic effects of being a major league city.

These represent two of the seminal works in the field of stadia research, yet each deals with the location of stadia only very tangentially. Baim has no suggestions as to the optimal location of a stadia to improve its profitability. Similarly, Euchner suggests that cities simply throw teams out unless they want to seriously help finance a new facility.

I would suggest that, while there may not be a single optimal site for a new stadium, there most assuredly are specific attributes of sites at which a new facility might fit both economically and socially into a metropolitan area. These attributes must certainly start with a minimum acreage. As with any facility, a piece of must be sufficiently large to carry the facility once completed. Just as you cannot build a sprawling apartment complex on one acre, you similarly cannot build a stadium on three or four acres.

Just as a minimum parcel size is a necessity for a sports facility, I would suggest that there are other attributes, some objective, some subjective, that make for a best-fitting site for a new stadium. Before turning to the limited research into this topic, I want to turn to one or two theoretical questions surrounding stadia location.

A Question of Scale

The first question I would pose is: At what level should the location of sports stadia be studied? There are ramifications both at the metropolitan level and at the local level when a new stadium is constructed. At the metropolitan level the primary issue is one of accessibility to the market. A stadium needs to be located so that a sufficiently large fan base is attracted to and able to attend the various events held at the facility. This fan base is usually drawn from (at minimum) the metropolitan level, often extending into the region as a whole.

At the local level the issues are more related to existing and future land uses. A stadium built in the center of an affluent suburban neighborhood is likely to cause negative externalities for both the residents and the stadium. Similarly, the location of a stadium next to a paper mill might not be too significant of a problem for the mill, but the stadium is likely to have attendance problems because of the air pollution. In a bit we will turn to the model laid out by Baade and Dye who suggest that stadia should be located to maximize the economic returns for the municipality.

Drawing on the above discussion, I would therefore suggest that there should be two levels of analysis of stadium location:

  1. The Metropolitan Level: Where within the metropolitan area have stadia been locating in the past? Are there any discernible trends at the metropolitan level? Are there underlying factors behind these trends?

  2. The Local/Land Use Level:Within a given area, where are stadia located? Have cities placed stadia near commercial centers? Industrial areas? What of links to transportation?

A Question of Ownership

Another intriguing question from my perspective is that of governmental ownership and the resulting effect upon location. For example, the Georgia Dome (in Atlanta) was financed mainly with state funds. After the allocation of funds the location of the Dome was debated, but only as it related to sites within the city of Atlanta. Recall that Atlanta is the capital of Georgia. I would suggest that, because state funds were involved, locational options outside of the city of Atlanta were not considered. Atlanta is the showcase city for the state and, further, the state capital lies not but a few miles from the Georgia Dome. Was the location affected by the financier? Most certainly.

Another example of the effect of ownership has been the recent push by numerous suburban counties or cities to attract a franchise out of downtown stadia and into new suburban facilities. This has been a trend throughout the past thirty years (see the Pontiac Silverdome outside of Detroit or the Meadowlands outside of New York for examples). Recently Gary, Indiana, a suburb of Chicago, has made a strong pitch for the Chicago Bears football team. They have offered the team a new stadium, parking revenue, advertising revenue, as well as a very small rental fee for the facility. Clearly, Gary would not offer such a deal without the locational movement of the Bears to their city. Once again, the purse strings have an important locational affect.

These two questions represent only the tip of a grand iceberg of possible research into the location of sports facilities. Let us now turn our attention to a brief review of the research that can be more directly related to the location of sports teams and sports stadia.

Sports Stadia and Locational Research

The first piece I would like to mention is a very contentious research note in Scientific American. Author Gary Stix reported of a study done by Alan Sager and Arthur Culbert that concluded that the primary variable behind the movement of baseball teams from cities to new cities or to new locations within cities was the evolution of the stadium’s surrounding neighborhood from white to black. Succinctly stated, race was the sole significant variable behind the movement of baseball franchises to new stadiums in the 1950’s through the 1970’s. This finding was presented, with little reaction, at the Cooperstown Symposium on Baseball and American Culture in 1992. The authors note that this finding is not likely to persist into recent years.

The significance of this finding upon the location of stadia might initially be lost on the reader. However, if this finding is indeed correct, this suggests that race plays a factor in the location of teams. Taken a step further, it stands to reason that race would affect the location of a new stadium as teams might not wish to locate in a predominately black area. I wanted to mention this study because it suggests that there may be important factors behind the location of stadia at the metropolitan level. These authors might suggest race as a possible factor. I might suggest that income level is likely an important variable in the location of new stadia.

At the same time that I want to bring forth the possible implications of this research note, I also do not want to sound alarmist and start to suggest that stadium location is racially motivated. The sample for this study was quite small and it does not study recent team movements or stadium locations.

The next piece I want to mention is an article that was not written about sports stadia per se, but one which is applicable to facilities like stadia. Swallow, Opaluch, and Weaver’s 1992 article in Land Economic entitled Siting Noxious Facilities, discusses the policy approach to the location of facilities that generate significant negative externalities. Traditionally noxious facilities have been identified as uses like large landfills or sewage treatment plants. However, a case could certainly be made to suggest that stadia are noxious facilities because of the large crowds they generate resulting in the significant traffic congestion and the pollution.

Swallow et al present a nice review of the literature before turning to their approach to the siting of these facilities. They suggested a siting procedure to determine the sire of a noxious facility. This three step process is as follows:

  1. Choosing a long list of sites based upon certain minimum technical standards. For a stadium these standards would include a minimum parcel size, existing transportation and parking infrastructure (or significant opportunities to achieve this), and compatibility of neighboring uses.

  2. The second stage narrows the original site list by some social standards. These social standards might include a desire to revitalize downtown (i.e. Baltimore, Cleveland) or a goal of integrating the existing stadium with the convention infrastructure (i.e. Atlanta, St. Louis). This process should narrow down the list of sites significantly.

  3. The third, and final, stage has been labeled by the authors as Compensation/Community Acceptance. Swallow et al clearly recognize the implications of locating a noxious facility. The existing community within which this landfill or stadium is to be inserted is likely to be upset with this decision. Invariably some form of negotiation will be required to determine an adequate compensation for the community. For examples, in Atlanta the siting of the new Olympic Stadium in the same neighborhood as the existing Fulton County Stadium required special concessions from the Olympic Committee and the Atlanta Braves over parking revenues and local hirings.

Swallow et al’s model of facility siting is quite general, but a very important illustrative tool. It illustrates the necessity to approach the siting of a facility as a funneling process that will eventually be resolved.

The final article I wish to note is a seminal article by Robert Baade and Richard Dye of Lake Forest College outside of Chicago. These authors have placed themselves among the forefront of the stadium financing and location debate. Their 1988 Economic Development Quarterly article, Sports Stadiums and Area Development: A Critical Review, has been one of the most influential on the stadium debate. While the books by Baim and Euchner have largely been ignored, Baade (in particular) and Dye have come to be associated with the anti-stadium view.

In this piece Baade and Dye argue quite vehemently against the financing of stadia by local governments. They suggest that professional sports are not the panacea that they are portrayed to be. However, the section of the article I wish to focus on is their discussion of some guidelines for the optimal location of stadia. The authors suggest some important rules of thumb when locating a stadium. These are:

These rules of thumb are excellent examples of the social considerations discussed by Swallow et al. They could very easily be utilized to narrow a large list of sites to only a few. In sum, Baade and Dye suggest that the best strategy for stadium location is to consider optimizing the economic benefits above all else. Their rules quite clearly suggest that an urban ballpark, with pedestrian access and interesting and numerous ancillary uses create the best locational choice for a new stadium.

To jump back to the top of the Some Thoughts on Stadia Home Page

To jump back to the Stadia Home Page

Comments? Send E-mail to