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THE $10 QUESTION
Jamal Greene
April 23, 2001
Having wearied of bad-mouthing squeegee men, New York City mayor Rudy Giuliani recently turned his wrath toward another troublemaker: Smith College economist Andrew Zimbalist. "I don't know any major American business that would employ him," Giuliani said.
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April 23, 2001

The $10 Question

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Having wearied of bad-mouthing squeegee men, New York City mayor Rudy Giuliani recently turned his wrath toward another troublemaker: Smith College economist Andrew Zimbalist. "I don't know any major American business that would employ him," Giuliani said.

Zimbalist has the gall to argue that cities don't benefit from new sports stadiums, a position that doesn't sit well with Giuliani, who wants to build a $1 billion home for his beloved Yankees. "Every economist who has not been paid by proponents [of new stadiums] has argued that you can't anticipate a positive economic impact from building a new ballpark," says Zimbalist. "Who knows what fantasy world Giuliani's living in?"

It's a familiar debate, pitting city officials who would dip into public coffers for stadiums against academics who argue that arenas simply transfer spending from other local businesses to sports teams. A 1999 study by economists Dennis Coates and Brad Humphreys asserted that in cities with major league baseball teams, per capita income fell by $10 per person per year in the decade after stadiums were built. Says Coates, "The right question is, Is having this stadium worth $10 a year to you?" But Cleveland lawyer Tom Chema, who directed the development of the Indians' Jacobs Field, challenges the assumption that new stadiums don't bring in new revenue. "Because of Jacobs Field and Gund Arena, six million people a year come to downtown Cleveland who wouldn't have before," says Chema, "and they bring their wallets with them."

The debate may be moot. Simply put, people like having pro teams in their towns. Says former Arlington, Texas, mayor Richard Greene, who oversaw a 1992 sales-tax referendum to finance The Ballpark in Arlington, "People get to decide what they want done with their money. The expression of public opinion should pretty much settle the arguments."

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