Economists: Impact of Ballparks Generally Positive, but Modest

With the Phoenixville Baseball Committee moving full speed ahead with plans to fierce debate has sprung up around the likely consequences of erecting a 4,000 seat ballpark on the former steel mill site.

Concerns about parking, quality of life, and the wisdom of spending $25 million on a baseball stadium in a town that sorely needs infrastructure work have been raised. But baseball committee spokesman Barry Cassidy has countered that the ballpark, and the fans it draws, could galvanize the already fast-growing area.

According to economists though, the debate may be much ado about nothing. The consensus is that the economic impact of a minor league ballpark, while varying from city to city, is a generally positive, but modest one.

A 2011 study published in the Journal of Sports Economics examined the 238 US cities that hosted a minor league baseball team between 1985 and 2006 and looked to see if they benefited from economic and quality of life improvements resulting from the stadium.

Its author found that building a AA stadium was associated with a $161 increase in per capita income and building a rookie league stadium was associated with a $202 increase (Phoenixville is likely to draw a rookie or independent league team). He added that dollar gains in income tax revenues in the cities in question were sufficient to cover the stadium cost in 75% of rookie league markets

The reason for the relatively small effect is simple, sports economist J.C. Bradbury told the Richmond Times-Dispatch: people may come to a minor league city ready to spend money, but they do it at the stadium

The notoriously optimistic growth projections of planners, he said, "assume people are spending money they wouldn't otherwise be spending" on other forms of entertainment in the city. "What the fans are [actually] doing," he said, "is relocating money from other entertainment" to the team.

In other words, money will likely be made. But most of it by the team.