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No, the Super Bowl Doesn't Really Make it Rain Hundreds of Millions of Dollars of Profits on Host Cities

Economists all seem to agree that sports leagues and politicians grossly exaggerate their economic impact claims

When it comes to misleading economic claims, there’s no bigger offender than the Super Bowl. 

In fact, you could call it “the Super Bowl of bad math,” since nearly every economist and data scientist seems to agree the economic impact claims made by the NFL and sports-loving politicians fall short.

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Here are just three of the ways taxpayers get misled:

Inflated Tourist Spending

In order to justify spending tens – or hundreds – of millions of tax dollars on sports events and sports stadiums, teams and leagues often cite the benefits their games bring to a community.

But the economic impact claims are typically attributed to marketing professionals, who often inflate how much a ticket-holder spends attending a game. 

Sometimes, economic impact reports double- or triple-count a single tourist, while others overlook the fact that not every ticket-holder is staying in local hotels and eating all of his/her meals out at restaurants.

Leagues and teams also don’t typically mention that a lot of big-game spending leaves the host community, due to what economists call “leakage.”  When a hotel, restaurant, or sports franchise is owned by a corporation that’s based elsewhere, much of that tourist spending winds up benefitting those other communities.

Holy Cross economist Victor Matheson has long advocated politicians take any economic impact figure provided by a team, league, or business seeking tax dollars, and move the decimal place one digit to the left to get a more appropriate estimate of actual economic benefit.

Taking credit for economic impact that would’ve happened anyway

Economic impact reports, compiled by marketing professionals on behalf of sports teams and leagues, aren’t afraid to take credit for tourism that likely would have happened anyway, such as northerners visiting Florida in the winter.

While the Super Bowl undoubtedly draws wealthy fans to host cities such as Tampa, Miami and Phoenix each February, most warm-weather cities are already enjoying high hotel occupancy and room rates in the middle of winter.  And when big crowds come to town, it often displaces visitors and spending that would have taken place in a normal year.

Big events create winners, but also losers

Sports leagues don’t like to acknowledge that championship games – and even some regular-season games – cause massive disruptions to a community, that can hurt just as many businesses as they help.

Locals often spend less than normal, choosing to watch the event from home or take part in free events associated with the big game.  And when heavy security is involved, as is typical for championship games or political events, regulars tend to avoid entire neighborhoods altogether, leaving many establishments empty.

When studies have looked at the overall spending following a big event – or even a baseball season without baseball – they have often found the games make little-to-no difference in regional spending.

While the pandemic may change the Super Bowl math for the Tampa Bay tourism industry this year, the frequent claims about a much-needed “shot in the arm” often neglect the extraordinary public costs associated with hosting the game, including the projected stress inflicted on the region’s health systems following the Super Bowl.

Medical experts have told reporters they expect to see an increase in Tampa Bay’s coronavirus cases – and thus, deaths caused by the coronavirus – following the Super Bowl.