New Royals owner John Sherman is giving interviews extolling the virtues of downtown baseball. In a recent story published on Flatland KC, Sherman said: “Baseball creates more economic opportunity in denser areas versus suburban areas or less dense areas.” Unfortunately, he does not offer any evidence to support the claim.
Mind you, a new baseball stadium funded by taxpayers might be great for the owners of the Royals. But what evidence is there for any benefit to taxpayers?
The St. Louis Federal Reserve pointed out that stadiums fail to drive economic development in a 2017 report, concluding:
Building sports stadiums has an impact on local economies. For that reason, many people support the use of government subsidies to help pay for stadiums. However, economists generally oppose such subsidies. They often stress that estimations of the economic impact of sports stadiums are exaggerated because they fail to recognize opportunity costs. Consumers who spend money on sporting events would likely spend the money on other forms of entertainment, which has a similar economic impact. Rather than subsidizing sports stadiums, governments could finance other projects such as infrastructure or education that have the potential to increase productivity and promote economic growth.
A 2019 piece in The Berkeley Economic Review, a publication of the University of California–Berkeley economic program, also failed to find any economic benefit from sports stadiums:
Over the last thirty years, building sports stadiums has served as a profitable undertaking for large sports teams, at the expense of the general public. While there are some short-term benefits, the inescapable truth is that the economic impact of these projects on their communities is minimal, while they can be an obstacle to real development in local neighborhoods.
The owners of the Royals are welcome to build a stadium wherever they like. But if they want to take tax dollars away from schools, public safety, and infrastructure to help build the stadium, they should share any evidence they have that such a plan presents a good return on investment for taxpayers—not just themselves.
