Tuesday, May 26, 2009

Sports as Economic Development Strategy

What's the best sports city in Canada and the United States? Indianapolis. (via Daniel W. Drezner) Home of Baltimore's Colts, Indy is a region enjoying relative economic prosperity and is one of the few bright spots in the Rust Belt. You will be surprise to learn how it arrived at urban success:

They built this city on sports, says Bill Benner, a former sports columnist at The Indianapolis Star. "Indianapolis, beginning about 30 years ago, used sports ... as an economic development strategy. Using sports as the cornerstone played out beyond anyone's imagination."

Even if Mr. Benner is mistaken, his perception of the modest Indianapolis boom is interesting. Conventional wisdom among economists is that stadium deals are a boondoggle and the benefits stemming from civic pride are marginal at best. But that doesn't stop politicians from banging the drum:

Some experts say the most beloved pro sports teams are the ones that adopt the prevailing identity of the city where they play.

In Indianapolis, that means mirroring the city's Midwestern values, says Indianapolis Mayor Greg Ballard.

"In Indiana, it's okay to win, but you have to win the right way. You have to do it with a strong work ethic. You have to do it as a team. You just can't do it any other way here."

Sound familiar? If anything, this strong sports identity is indicative of what is holding back America's urban frontier. Those very Midwestern values are a liability in the face of economic globalization. My guess is that better days in Indianapolis are mostly spillover from the resurrection of Chicago. The Colts horseshoe is about all the influence of sports has had on economic development in this region.


Stephen Gross said...

It's clear that the direct economic benefit of stadium deals is a net loss to cities.

It's not clear what the indirect benefits truly are. You have to look at cities that have lost or gained major teams to really evaluate that.

Paz said...

And is "cities" vs. "metros" an important distinction? Is the Palace benefiting Detroit, or Ralph Wilson benefiting Buffalo?